STATE OF NEW JERSEY, ETC. VS. CENTENNIAL LAND & DEVELOPMENT CORPORATION (C-000077-04, BURLINGTON COUNTY AND STATEWIDE) (CONSOLIDATED)

NOT FOR PUBLICATION WITHOUT THE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-1414-17T3
A-1616-17T3
STATE OF NEW JERSEY,
DEPARTMENT OF
ENVIRONMENTAL PROTECTION,
Plaintiff-Respondent,
v.
CENTENNIAL LAND &
DEVELOPMENT CORPORATION,
and DEVEL, LLC,
Defendants-Respondents/
Cross-Appellants,
and
STEPHEN D. SAMOST,
Defendant-Appellant/
Cross-Respondent,
and
TOWNSHIP OF MEDFORD, COUNTY
OF BURLINGTON, CENTENNIAL
PINES CLUB, and ESTATE OF
JOSEPH SAMOST,1
Defendants-Respondents.
__________________________________
STATE OF NEW JERSEY,
DEPARTMENT OF
ENVIRONMENTAL PROTECTION,
Plaintiff-Respondent,
v.
CENTENNIAL LAND &
DEVELOPMENT CORPORATION,
DEVEL, LLC, STEPHEN D. SAMOST,
TOWNSHIP OF MEDFORD, COUNTY
OF BURLINGTON, and CENTENNIAL
PINES CLUB,
Defendants-Respondents,
and
CENTENNIAL PINES CLUB,
Third-Party Plaintiff-Respondent,
v.
ESTATE OF JOSEPH SAMOST,
Third-Party Defendant-Appellant.
__________________________________
1
Joseph Samost passed away during the pendency of this appeal. On July 8,
2019, we granted the Estate's motion to substitute in as a party to the appeal.
A-1414-17T3
2
Argued November 20, 2019 – Decided December 19, 2019
Before Judges Haas, Mayer and Enright.
On appeal from the Superior Court of New Jersey
Chancery Division, Burlington County, C-000077-04.
Peter Jay Boyer argued the cause for appellant/cross-
respondent Steven D. Samost in A-1414-17 and
respondent Steven D. Samost in A-1616-17 (Hyland
Levin, LLP, attorneys; Peter Jay Boyer, on the briefs).
Thomas Andrew Hagner argued the cause for
respondent Estate of Joseph Samost in A-1414-17 and
appellant Estate of Joseph Samost in A-1616-17
(Hagner & Zohlman, LLC, attorneys; Thomas J.
Hagner and Thomas Andrew Hagner, on the briefs).
Paul Leodori argued the cause for respondents/cross-
appellants Centennial Land & Development
Corporation and Devel, LLC in A-1414-17 and
respondents Centennial Land & Development
Corporation and Devel, LLC in A-1616-17.
Aaron A. Love, Deputy Attorney General, argued the
cause for respondent Department of Environmental
Protection (Gurbir S. Grewal, Attorney General,
attorney; Melissa H. Raksa, Assistant Attorney
General, of counsel; Aaron A. Love, on the brief).
Jay H. Greenblatt argued the cause for respondent
Centennial Pines Club (Greenblatt & Laube, PC,
attorneys, join in the brief of respondent Department of
Environmental Protection).
Madden & Madden, PA, attorneys for respondent
County of Burlington, join in the brief of respondent
Department of Environmental Protection.
A-1414-17T3
3
PER CURIAM
This is the latest stage in protracted environmental litigation under the
New Jersey Safe Dam Act, N.J.S.A. 58:4-1 to -14 (the Act), which the
Department of Environmental Protection (DEP) commenced in 2004 seeking
injunctive relief and civil monetary penalties against a number of individuals
and entities. In the previous round of appellate litigation, this court affirmed a
number of interlocutory trial court orders on the merits, including a June 9, 2014
order imposing civil monetary penalties upon appellants Joseph and Stephen
Samost, and cross-appellant Centennial Land & Development Corporation
(CLDC) (collectively appellants) under the Act. Dep't of Envtl. Prot. v.
Centennial Land & Dev. Corp., No. A-4708-13 (App. Div. Oct. 21, 2016).
On October 10, 2017, the trial court entered final judgment regarding the
civil monetary penalties against the Samosts and CLDC. These parties now
challenge the entry of final judgment, but also purport to challenge the already-
affirmed June 9, 2014 penalty order by presenting many of the same legal
arguments this court has already determined lack merit. We again reject the
parties' attempt to overturn the June 9, 2014 order because our prior opinion
resolving the interlocutory appeal on the merits is the law of the case, and we
affirm the entry of the October 17, 2017 final judgment.
A-1414-17T3
4
I.
Centennial Lake is a fifty-three acre body of water located within Medford
Township (Medford). Residential homes and some commercial properties are
located downstream of the dam. The lake's water level is controlled by an
eighteen-foot tall earthen dam known as the Centennial Lake dam.
The dam was originally constructed in the nineteenth century and
underwent reconstruction in 1954. It is composed of a spillway, culvert, and
embankment. Centennial Avenue traverses the top of the dam, the spillway is
located upstream, and the culvert runs under the road.
In 1957, the Centennial Lake Company (Lake Company), which owned
the dam, lake, and surrounding land, entered into a memorandum of agreement
with the Centennial Pines Club (Pines Club) to redevelop the land surrounding
the lake. The Pines Club is an association comprised of members who hold title
to property or reside as tenants on property within the Centennial Lake
development area. According to the agreement, upon development of a certain
percentage of lots and the fulfillment of other conditions, the common areas
owned by the Lake Company—including the dam—would be transferred to the
Pines Club.
A-1414-17T3
5
In 1971, CLDC purchased the property owned by the Lake Company,
including the dam. The transfers were subject to the 1957 agreement between
CLDC's predecessor and the Pines Club. In 1972, Joseph Samost 2 became the
president and sole officer of CLDC by acquiring all its stock. Since the early
1970s, Joseph's son, Stephen, acted as the attorney for or representative of
CLDC and other companies owned by his father. Through all relevant periods
of the litigation, CLDC owned the spillway and embankment of the dam, while
the County of Burlington (Burlington) owned the dam's culvert. Medford owned
an easement to operate and maintain the roadway over the dam.
In 1979, the United States Army Corp of Engineers (ACE) released a dam
inspection report citing deficiencies and reporting the dam as a high hazard
potential structure, based upon the potential impacts downstream if the dam
were to fail. It found the spillway to be seriously inadequate and unsafe.
According to the report, a major storm could have caused the dam to fail,
resulting in the risk of downstream property damage and loss of life. The ACE
report provided a number of recommendations that included performing studies
regarding the spillway, designing modifications to improve the spillway,
2
Because the Samosts share the same surname, we refer to them by their first
names to avoid confusion. In doing so, we intend no disrespect.
A-1414-17T3
6
clearing trees and brush from the embankments, and stabilizing eroded and bare
areas along the embankment slopes.
DEP adopted the ACE's findings regarding the dam's classification as a
high hazard. DEP ordered CLDC to make the repairs recommended in the ACE
report.
In 1983, CLDC transferred its developable properties surrounding the lake
to other entities controlled by Joseph. After the transfer, CLDC only owned the
lake, dam, and beach. Through the 1980s, the entities controlled by Joseph filed
applications to residentially develop the land surrounding the lake, which the
Pines Club opposed in litigation.
The parties entered into a settlement agreement that established a
maximum amount of development that could occur surrounding the lake. In
1985, the parties entered into a memorandum of agreement amending the 1957
agreement to establish that CLDC would convey its title to the lake, dam, and
beach to the Pines Club after selling ninety percent of its waterfront lots and
fifty percent of secondary lots. Pending the conveyance, CLDC agreed to
maintain, manage, and control the lake, dam, and beach, at its own expense.
A-1414-17T3
7
In 1989, Joseph transferred ownership of the lands surrounding the lake
to entities controlled by Stephen. CLDC continued to own the lake bed, beach,
and dam.
II.
CLDC did not comply with the DEP order to make the repairs set forth in
the ACE report and ignored six additional DEP orders between 1981 and 1990
that contained similar directives. In April 1990, DEP inspected the dam and
concluded that it was at risk of failure because of structural weakness in the
culvert. In April and May 1990, DEP asked that CLDC, Medford, Burlington,
and the Pines Club lower the level of the lake until further notice. The parties
did not adhere to DEP's request.
Subsequently, DEP filed suit seeking injunctive relief and statutory
penalties, claiming the dam was "at imminent risk of failing." In July 1990, the
court ordered the parties to lower the level of the lake.
After an independent engineering report confirmed DEP's findings, DEP
ordered CLDC, Medford, and Burlington to reconstruct the spillway and culvert
and rehabilitate the earthen embankment. Burlington received a permit from
DEP to replace the culvert in October 1990. Medcon Farms, an entity controlled
by Stephen, received a permit for spillway reconstruction in December 1990.
A-1414-17T3
8
However, neither Medcon Farms nor CLDC repaired the spillway. Burlington
completed reconstruction of both the culvert and spillway in 1992 or 1993.
DEP determined that even with Burlington's repairs, the dam still did not
satisfy regulatory safety requirements. The remaining issues involved whether
grading and armoring the embankment was necessary to satisfy the regulatory
standards, as DEP argued, and whether Burlington would be reimbursed for
replacing the spillway, which CLDC owned. Settlement discussions ensued and,
in 1993, Stephen sent a letter to the court indicating that an agreement had been
reached. The court dismissed DEP's complaint with prejudice based upon that
representation, even though there was no signed agreement. Negotiations for a
settlement agreement eventually stalled, and the armoring was not done.
In 1998, litigation between Joseph and Stephen arose regarding the
ownership of various properties owned by different family members. Although
the origins of the litigation are unclear, the parties eventually found their way to
federal court. The Pines Club sent letters to the court asserting an interest
against the Samosts for unpaid expenses regarding the maintenance of the
Centennial Lake properties in preceding years but did not intervene as a party.
The litigation between Joseph and Stephen settled, but disputes arose as to
implementation of the settlement, over which the federal court retained
A-1414-17T3
9
jurisdiction and appointed a special master. The federal judge overseeing the
matter accepted the special master's recommendations and issued an order
establishing that the responsibility for reimbursing the Pines Club for
maintenance expenses would be borne by Joseph but ruled that the cost of
repairing the dam and embankment would be borne by Stephen.
As a result of that litigation, Joseph agreed to transfer 100% of his stock
in CLDC to Stephen, which took place on January 28, 2002. At some point
thereafter, Stephen transferred his CLDC stock to Devel, LLC (Devel). Stephen
owned a ninety percent interest in Devel, and his wife owned the other ten
percent interest. In light of that transfer, Stephen considered himself the
"president de facto and director de facto" of CLDC.
At some point in the early 2000s, the turnover threshold set forth in the
1985 memorandum of understanding between CLDC and the Pines Club was
satisfied. However, the Pines Club refused to accept title to the lake and dam
due to CLDC's failure to maintain and repair the dam.
In 2004, the federal court amended its previous order. It maintained that
Joseph was liable for reimbursing the Pines Club, but instead of declaring
Stephen personally liable for repairing the dam, as in the previous order, it
A-1414-17T3
10
declared CLDC liable. It also observed that Devel had become the owner of
CLDC.
III.
CLDC failed to adhere to several orders and directives issued by DEP
between 1997 and 2001. In January 2003, after Stephen acquired CLDC, DEP
informed him that the dam must be rehabilitated further to come into compliance
with the regulatory standards.
In May 2004, DEP filed an action against CLDC, Medford, Burlington,
and the Pines Club. The complaint alleged that each defendant exercised
ownership or control of the dam in various degrees and sought to hold them all
liable for injunctive relief and civil monetary penalties under the Act. DEP
sought to compel defendants to submit a dam safety inspection report, an
emergency action plan, an operation and maintenance plan, and a final design
report and permit application for the repair of the dam. DEP's primary concern
when initiating the litigation was the dam's spillway, which it found was
undersized for a dam classified as high hazard.
On July 27, 2004, CLDC recorded a deed dated July 22, 2004, purporting
to convey the dam, lake, and beach to the Pines Club. On December 3, 2004,
the Chancery Division entered an order setting aside the deed transfer and
A-1414-17T3
11
declaring it "void ab initio and of no effect." The court reasoned that the 1985
contract to convey the deed required CLDC to make repairs and maintain the
dam until the conditions for the transfer were satisfied, which it had not d one.
CLDC remained the dam's owner. The court also enjoined CLDC from
transferring ownership pending further court order.
Later that same year, the Pines Club retained McCormick Taylor
Engineering (McCormick) to prepare a regular dam inspection report.
McCormick agreed with DEP that the dam was in an unsafe condition and the
spillway was inadequate.
In 2004, Stephen also retained the services of an engineering firm,
Underwood Engineering Company (Underwood), to inspect the dam.
Underwood found deficiencies and recommended draining the lake immediately
to allow a complete inspection of the dam.
On October 19, 2004, DEP ordered CLDC, Medford, Burlington, and the
Pines Club to retain an engineer and implement the McCormick report's
recommendations to "bring the structure into compliance with the Safe Dam Act
and the applicable regulations." On April 7, 2005, DEP issued another order to
the same effect, noting that the defendants had not yet complied. The second
order included Stephen and Devel.
A-1414-17T3
12
In 2005, DEP amended its complaint to include claims against Stephen
and Devel. On April 26, 2006, the court denied CLDC's motion to dismiss the
complaint. On October 3, 2006, the court denied reconsideration and partial
summary judgment motions filed by CLDC, Devel, and Stephen.
CLDC, through Stephen, submitted an emergency action plan for the dam
in June 2006, which DEP found to be defective. CLDC did not address the
deficiencies. At some point, the Pines Club filed a third-party complaint against
Joseph. In 2008, DEP amended its complaint to add Joseph as a defendant.
By May 2010, the repairs had not been completed. On November 30,
2010, the court granted DEP's partial motion for summary judgment, which
sought a declaration that each defendant was liable for the repair and
maintenance of the dam under the Act, as to CLDC, Devel, Stephen, Joseph, the
Club, and Burlington. The court dismissed DEP's complaint as to Medford with
prejudice.
On March 23, 2011, the court granted the Pines Club's motion for
summary judgment against Joseph, which sought a declaration that he was liable
for costs incurred by the Pines Club on lake and beach maintenance, and for any
costs incurred by the Pines Club as a result of DEP litigation. The court also
denied Joseph's cross-motion for summary judgment. On August 5, 2011, the
A-1414-17T3
13
court denied Joseph's motion for reconsideration. On January 6, 2012, the court
issued another order declaring the July 22, 2004 deed void ab initio and
restraining CLDC from transferring ownership of the property during litigation.
On March 9, 2012, the court issued an order and written decision
apportioning defendants' liability to fund necessary studies and make repairs. It
assigned 10% responsibility to the Pines Club, 45% to Joseph and CLDC, and
45% to Stephen and Devel. Burlington's responsibility was to be determined at
a later date following engineering studies. On June 20, 2012, the court appointed
a receiver to perform all obligations of the defendants with respect to the
reconstruction and repair of the dam. On October 31, 2012, the court granted
summary judgment to the Pines Club in relation to its third-party claims against
Joseph. The court denied Joseph's motion for reconsideration on December 7,
2012.
In January 2013, DEP filed a motion for final summary judgment against
defendants, seeking penalties for violations of the Act and for failing t o comply
with its enforcement orders. The court granted the motion on June 9, 2014 and
issued an order and detailed written decision. It declared CLDC, Devel,
Stephen, and Joseph liable for civil penalties of $750,000 for the period between
A-1414-17T3
14
May 1994 and June 2014. Of that amount, the court assessed $50,000 solely
against the Pines Club.
In March 2014, McCormick issued a report following its inspection of the
dam on behalf of the court-appointed receiver. McCormick found the dam to be
in "poor condition," and recommended several improvements and additional
studies. On June 26, 2014, the court assessed costs for engineering design and
permitting against the defendants. The payments were to be made to the court-
appointed receiver.
IV.
CLDC, Devel, and Stephen filed a motion for leave to appeal nine court
orders issued between December 2004 and June 2014.3 Joseph filed a cross-
3
These parties challenged the December 3, 2004 order rescinding CLDC's deed
transfer to the Pines Club; the April 26, 2006 order denying CLDC's motion to
dismiss the complaint; the October 3, 2006 order denying reconsideration and
denying partial summary judgment to CLDC, Devel, and Stephen; the November
30, 2010 order granting partial summary judgment to DEP; the March 23, 2011
order granting summary judgment to the Pines Club against Joseph and denying
Joseph's cross-motion; the August 5, 2011 order denying Joseph's motion for
reconsideration; the March 9, 2012 order apportioning liability among
defendants; the May 30, 2012 order denying reconsideration; and the June 9,
2014 order fixing statutory penalties.
A-1414-17T3
15
motion for leave to appeal challenging some of the same orders.4 Joseph's cross-
appeal also challenged four additional orders.5 The Pines Club filed a cross-
appeal challenging provisions of the November 30, 2010, March 9, 2012, an d
June 9, 2014, orders.
On September 12, 2014, this court granted interlocutory review, but did
not stay the trial court's orders. On October 21, 2016, we issued a fifty-one-
page decision affirming all of the challenged orders on the merits. We
subsequently denied Joseph's motion for reconsideration and, on March 23,
2017, the Supreme Court denied motions for leave to appeal filed by Stephen,
CLDC, and Devel, and dismissed Joseph's cross-petition for certification.
V.
Following our decision, DEP moved before the trial court for entry of final
judgment on the previously awarded civil penalties. On October 10, 2017, the
4
These orders included the November 30, 2010, March 23, 2011, August 5,
2011, March 9, 2012, and June 9, 2014 orders noted above.
5
Joseph challenged the June 20, 2012 order appointing a receiver for the dam
repairs; the October 31, 2012 order granting final summary judgment to the
Pines Club, dismissing Joseph's complaint against CLDC, and denying his
motion for summary judgment; the December 7, 2012 order denying
reconsideration; and a December 18, 2012 order that apportioned payment for
engineering costs.
A-1414-17T3
16
court entered the requested order. In doing so, the court found no justifiable
reason to delay enforcement of the penalty.
On November 24, 2017, Stephen filed a notice of appeal challenging the
court's October 10, 2017 order. In his case information statement, Stephen
indicated that he also challenged the court's June 9, 2014 order imposing
penalties, which he had already unsuccessfully appealed in Centennial Land &
Dev.
In response to Stephen's appeal, CLDC filed a notice of cross-appeal
challenging the October 10, 2017 order. 6 Although its notice of cross-appeal
only mentions the October 17, 2017 final judgment, in its case information
statement, CLDC noted that it challenges the underlying June 9, 2014, order
imposing penalties.
Joseph also filed a notice of appeal of the October 10, 2017 order on
November 27, 2017. Like Stephen, Joseph also purported to appeal the June 9,
2014 order, despite the court's prior decision affirming that order. We
6
The cross-appellant's brief refers to Devel as an additional cross-appellant, but
the notice of appeal filed on January 5, 2018, only mentions CLDC as the cross-
appellant. Both parties are represented by the same counsel, and as discussed,
Devel is the owner of CLDC. To avoid confusion, we hereafter collectively
refer to CLDC and Devel as CLDC.
A-1414-17T3
17
subsequently granted DEP's motion to consolidate the appeals and, after Joseph
passed away, granted a motion to substitute his Estate as a party.
VI.
As noted at the outset, appellants devote most of their appellate briefs to
their attacks on the June 9, 2014 order holding them liable for the penalties
imposed by DEP. However, we upheld that order in our prior decision and,
therefore, appellants' challenges are barred by the law of the case doctrine.
"[W]hen an issue is once litigated and decided during the course of a
particular case, that decision should be the end of the matter" and is "binding"
upon "a different appellate panel which may be asked to reconsider the same
issue in a subsequent appeal." State v. Hale, 127 N.J. Super. 407, 410 (App.
Div. 1974). Accordingly, appellate courts reject an appellant's "attempts to
reargue various matters which were previously decided by this court." Elmora
Hebrew Ctr., Inc. v. Fishman, 239 N.J. Super. 229, 232 (App. Div. 1990).
"Under the law of the case doctrine, an interlocutory ruling by the
Appellate Division generally is not subject to review on direct appeal."
Lombardi v. Masso, 207 N.J. 517, 539 (2011); see also Pressler & Verniero,
Current N.J. Court Rules, cmt. on R. 2:2-4 (2020). "An appellate decision which
is interlocutory in the sense that it does not terminate the case nevertheless
A-1414-17T3
18
finally decides the meritorious issue." State v. Myers, 239 N.J. Super. 158, 164
(App. Div. 1990). "That the decision was interlocutory does not mean that it
was 'tentative and subject to more leisurely review at a later date.'" Ibid.
(quoting State v. Stewart, 196 N.J. Super. 138 (App. Div. 1984)).
Thus, "[w]hen a party appeals from a final judgment, the party may seek
review of interlocutory orders that have not been . . . definitively ruled upon by
an appellate court in a prior or separate appeal." Silviera-Francisco v. Bd. of
Educ. of Elizabeth, 224 N.J. 126, 140-41 (2016) (emphasis added); see also
Washington Commons v. City of Jersey City, 416 N.J. Super. 555, 564 (App.
Div. 2010) ("[I]f an issue, such as one concerning a variance, has been
determined on the merits in a prior appeal it cannot be relitigated in a later appeal
of the same case, even if of constitutional dimension."); Pressler & Verniero,
cmt. 2.3.3 on R. 2:2-3.
The doctrine is a discretionary policy, not an absolute rule. Gonzalez v.
Ideal Tile Importing, 371 N.J. Super. 349, 356 (App. Div. 2004). Accordingly,
"[t]he respect and deference which should be given to prior rulings in the same
case 'must be balanced against other considerations, particularly the impact of
new law or new facts,' or . . . where the confusing nature of the prior decisions
requires clarification." Ibid. (quoting Rosenberg v. Otis Elevator Co., 366 N.J.
A-1414-17T3
19
Super. 292, 302 (App. Div. 2004)). The doctrine may be relaxed "if the interests
of justice will be served," in particular "where there has been an intervening and
retroactive change in the law" that "might affect a non-final mixed factual and
legal adjudication." Sisler v. Gannett Co., 222 N.J. Super. 153, 160 (App. Div.
1987). When "applied to a prior appellate decision in the same case, the [law of
the case] doctrine is more stringent." Ibid.
As previously noted, we squarely rejected the parties' challenges to the
June 9, 2014 order on the merits in our 2016 decision. Centennial Land & Dev.,
slip op. at 36. Although the parties also purport to appeal the October 10, 2017
final judgment,7 it is clear that the focus of their appeals is to once more
challenge the June 9, 2014 penalty order, which this court already affirmed on
the merits. Under the law of the case doctrine, the Estate, Stephen, and CLDC
are clearly barred from again attacking this order.
Even if we were to consider appellants' arguments, we would again reject
them because they are largely identical to the contentions we found lacked merit
7
Of the many arguments presented in the Estate's fifty-five-page brief, only the
final one, consisting of approximately one page, challenges the entry of the
October 10, 2017 final judgment. Stephen dedicates just a few sentences of his
forty-page brief to challenge the entry of that judgment. CLDC's brief makes
no attempt to challenge the October 10 judgment at all. All the other issues and
arguments asserted by the parties challenge the already-affirmed June 9, 2014
order imposing penalties.
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in our 2016 decision. For example, the Estate claims Joseph did not own or
control the dam during the relevant periods. However, this court expressly held
that Joseph is liable because he controlled the dam over a relevant period.
Centennial Land & Dev., slip op. at 40-41.
The Estate also argues that the trial court misconstrued the Act by
improperly relying upon Department of Environmental Protection v. Ventron
Corp., 94 N.J. 473 (1983), the Spill Compensation and Control Act (Spill Act),
N.J.S.A. 58:10-23.11, and Department of Environmental Protection v. Standard
Tank Cleaning Corp., 284 N.J. Super. 391 (App. Div. 1995), to find corporate
officer liability. Contrary to the Estate's claim, this court cited both Ventron
and the Spill Act with approval in its decision when finding Stephen responsible
under the Safe Dam Act as a corporate officer. Centennial Land & Dev., slip
op. at 28-29.
The Estate also argues that a trial was warranted to resolve ownership and
control issues. However, this court previously held that it was "unfounded . . .
that summary judgment was obviated by material factual disputes." Id. at 42.
The Estate's related argument that the trial court erred when finding that Joseph
waived a plenary hearing is undercut by this court's holding that the factual
record did not warrant a plenary hearing. Id. at 42-43.
A-1414-17T3
21
The Estate asserts that the federal settlement that resulted in Joseph's
transfer of the dam to Stephen relieved Joseph of liability, but this court already
"disagree[d] with Joseph's contention that his transfer of the dam in 2001,
severed his liability under the Act." Id. at 40.
The Estate's argument that the court erred "as a matter of law" when
awarding statutory penalties against Joseph is composed of several sub-
arguments, all of which this court rejected on the merits in Centennial Land &
Dev. Regarding the Estate's sub-argument that penalties under the Act were
inappropriate because none of DEP's directives were issued to Joseph
personally, this court held that this claim was "untenable" because Joseph knew
that problems existed with the dam beginning with the 1979 ACE report. Id. at
44. The Estate also asserts that the penalties were arbitrary because the court
improperly excluded Burlington and the Pines Club from the penalty award, but
this court has already ruled that there was no abuse of discretion in excluding
Burlington. Ibid. As noted, the penalty award did not exclude the Pines Club.
This court's prior finding that the penalty order "reflects a reasoned exercise of
discretion" undermines any other basis for arbitrariness the Estate presently
asserts. Id. at 44. The Estate claims DEP waived its claim for statutory
penalties, but this court rejected Stephen's similar argument in the interlocutory
A-1414-17T3
22
appeal. Id. at 31-32. The Estate also maintains that DEP's penalty claims were
time-barred, but this court expressly rejected that theory. Id. at 37-38.
Finally, the Estate claims that DEP's application for penalties was
procedurally defective under the rules governing verified complaints. Joseph
presented the same argument to this court in his brief supporting the
interlocutory appeal, and we rejected this contention because Joseph failed to
timely present it to the trial court. Id. at 44.8
Stephen's appeal suffers from the same infirmities. He first argues that he
was immune from Safe Dam Act liability because, in his view, the Act precludes
liability solely upon status as a corporate officer. However, in Centennial Land
& Dev., we expressly rejected that theory, holding that "acts by individuals
exercising control of a dam, even if through a corporate entity, fall within" the
Act's purview. Id. at 26. We also rejected Stephen's argument that he was
immune from penalties because he was not specifically named in any DEP order.
8
In any event, the argument is meritless. The Estate relies upon Rule 4:70,
which does require a verified complaint, but governs "an action to enforce a civil
penalty imposed by any statute or ordinance providing for its collection or
enforcement by a civil proceeding." R. 4:70-1(a). DEP did not file its complaint
as a mere collection action; its complaint sought injunctive relief and statutory
penalties from the court pursuant to N.J.S.A. 58:4-6(e), which permits DEP to
initiate a private action under the Act in Superior Court, in lieu of imposing civil
administrative penalties.
A-1414-17T3
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This court held that at least one order and DEP notice identified Stephen, that
Stephen's responsibility to act was stated in the federal litigation, and that, "[t]he
fact that further orders from [DEP] were not directed to Stephen is of no
consequence." Id. at 35.
In this appeal, Stephen also argues that he reasonably believed he had no
personal responsibility for repairing the dam because of a federal court order
and precedent from this court. We rejected this argument in our 2016 decision
and noted that a 2001 federal order declared Stephen personally responsible for
repairing the dam. Id. at 34. Although the federal court amended the order in
2004 after Stephen transferred his ownership in CLDC to Devel, this court held
that, "this change in ownership, initiated solely by Stephen to his controlled
holding company, does not erase his responsibility." Ibid.
To support his argument that he reasonably relied upon precedent from
this court, Stephen cites Asdal Builders v. Department of Environmental
Protection, 426 N.J. Super. 564 (App. Div. 2012). In Asdal, this court held that,
under the Flood Hazard Area Control Act (FHACA), N.J.S.A. 58:16A-50 to
-68, the implementing regulations' use of the term "person" did not encompass
a "responsible corporate officer," prior to an amendment that made the inclusion
explicit. Id. at 578-79. Although this court's previous decision did not directly
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cite Asdal,9 it squarely rejected the theory that "the absence of inclusion of a
'responsible corporate officer' within the definitions of 'person' restricts the
[Safe Dam] Act's scope and precludes an individual obligation to pay for the
dam repairs and maintenance or penalties." Centennial Land & Dev., slip op. at
25. This court held that, "acts by individuals exercising control of a dam, even
if through a corporate entity, fall within N.J.S.A. 58:4-5 [declaring
responsibilities with respect to dam maintenance] and -6 [providing for statutory
penalties]." Id. at 26. Further, because Asdal says nothing regarding the Act, it
is unclear how Stephen could have reasonably relied upon it when seeking to
shirk responsibility for maintaining the dam using holding companies.
Another of Stephen's current arguments challenges the allocation of
penalties for periods when he alleges he was not a corporate officer of CLDC.
The matter of penalty allocation was briefed extensively in the interlocutory
appeal, and this court was "not persuaded the [trial] judge erred in her
9
In their reply briefs, the Estate and Stephen unpersuasively argue that our prior
decision should not be considered the law of the case because it "disregarded"
the holding in Asdal. However, Asdal predates the court's decision resolving
the interlocutory appeal, and thus does not constitute an intervening change i n
the law that warrants relaxation of the law of the case doctrine. Further, as
discussed, although this court did not directly cite Asdal, we implicitly rejected
importing its holding relating to corporate officer liability under the FHACA
into the Safe Dam Act context. The Estate and Stephen fail to demonstrate how
Asdal warrants relitigating the same order that this court has already affirmed.
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application of N.J.S.A. 58:4-6 or that she abused her discretion in the ordered
allocation." Id. at 30.
Finally, this court's prior decision also addressed Stephen's argument that
the Act does not authorize penalties covering the period before March 9, 2012,
when the trial court issued an order apportioning the defendants' liability for
ongoing repairs. As noted, in resolving the interlocutory appeal on the merits,
we rejected the theory that Stephen is not subject to penalties because he was
not named in earlier DEP orders. Id. at 34. This court found that Stephen was
a "person having control of the dam" and thus squarely within the Act's purview.
Id. at 32-35. Thus, not only do the parties attempt to appeal the same order
twice, the Estate and Stephen rehash many of their same failed arguments.
Stephen argues that this court's prior decision is not the law of the case
because unlike the previous challenged orders, the October 10, 2017 order
declares the defendants jointly liable. We disagree.
The June 9, 2014 order specifically states that CLDC, Devel, Stephen, and
Joseph are "liable for civil penalties in the amount of $750,000 for the period of
May 1994 through June 2014," with $50,000 of that amount assessed to the Pines
Club. The October 10, 2017 order merely added the word "jointly" when
reducing the award to a final judgment, noting that CLDC, Devel, Stephen, and
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Joseph were jointly liable for $700,000. Although the June 2014 order did not
use the word "jointly," it is clear that the assessment of a single monetary penalty
against multiple defendants was a joint penalty assessment. Cf. Fid. Union Bank
v. United Plastics, 218 N.J. Super. 381, 389 (App. Div. 1987) (observing that
judgment "against the individual defendants" imposed joint and several
liability). Furthermore, the trial court's detailed written decision accompanying
the June 9, 2014 order explained that the fines were "collective" and that Joseph
and Stephen were "jointly liable" together with CLDC and Devel. Thus, the
October 10, 2017 order did not change the penalties in any appreciable way. It
merely reduced the penalties to a final judgment to permit DEP to begin
collection efforts.
Thus, under the law of the case doctrine, Joseph's and Stephen's challenge
to the June 9, 2014 order must fail. And, as discussed in detail above, even if
we were to consider appellants' contentions anew, they continue to lack any
merit. Therefore, we again affirm the June 9, 2014 order.
VII.
In its cross-appeal, CLDC raises arguments this court did not previously
address in Centennial Land & Dev. However, CLDC was an appellant in the
prior appeal involving that order and was obligated to raise any arguments it had
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concerning that order at that time. See State v. Lefante, 14 N.J. 584, 591 (1954)
(holding that an appellant "must present all arguments in support of his [or her]
stand" and, if the party "fails to present all of the points on which he [or s he]
rests [their] case[,] [the party] is deemed to have waived them and . . . cannot at
some later stage in the same proceeding . . . argue points which [the party] has
in effect abandoned"). Therefore, CLDC's challenge to the June 9, 2014 order
must also fail under the law of the case doctrine.
Nevertheless, we will briefly address CLDC's newly minted arguments for
purposes of completeness. CLDC challenges the 2014 order's imposition of
penalties as violating its due process rights, the "square corners" doctrine, and
notions of "fundamental fairness." These arguments lack merit.
"In New Jersey, as elsewhere, '[t]he essential components of due process
are notice and an opportunity to be heard.'" First Resolution Inv. Corp. v. Seker,
171 N.J. 502, 513–14 (2002) (quoting Mettinger v. Globe Slicing Mach., 153
N.J. 371, 389 (1998)). CLDC premises its due process argument upon the notion
that it litigated issues of ownership and control over the dam in good faith over
many years. According to CLDC, the imposition of penalties covering those
periods of litigation violated its right to a "chance to know the opposing
evidence and argument and to present evidence and argument in response."
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Tosco Corp. v. N.J. Dep't of Transp., 337 N.J. Super. 199, 208 (App. Div. 2001)
(quoting High Horizons Dev. v. Dep't of Transp., 120 N.J. 40 (1990)). In other
words, CLDC claims it is immune from any penalties during periods in which
the parties litigated bona fide factual disputes regarding the allocation of
responsibility for the dam. We disagree.
Notice is not an issue here because it is undisputed that CLDC owned at
least part of the dam between 1994 and 2014, the entire penalty period, and
actively participated in litigation regarding its responsibility under the Safe Dam
Act. CLDC's status as an owner under the Act, and at least some degree of
responsibility, was never in question.
Further, CLDC fails to show how it was deprived of a meaningful
opportunity to be heard regarding ownership and control issues. CLDC litigated
those issues over a long period and asserts no procedural defects in the trial court
or this court. The mere fact that multiple parties were ultimately found to be
partially responsible for the dam repairs and penalties does not excuse all the
parties from any liability over a twenty-year period of contentious litigation.
See Centennial Land & Dev., slip op. at 35 (holding that the Act "permits
penalties to be imposed jointly and severally on two or more owners or persons
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29
having control over a dam at different or at the same time for continuing
violations.").
Additionally, accepting CLDC's argument that it is immune from
responsibility while litigating ownership issues would vitiate the purpose of the
Act, remedial legislation under which DEP "is vested with sweeping regulatory
and enforcement powers" to ensure the safety of dams. N.J. Dep't of Envtl. Prot.
v. Alloway Twp., 438 N.J. Super. 501, 504 (App. Div. 2015). The Act "casts a
'broad net' of liability . . . so that its remedial purpose—'to protect the public
from the loss of life and property in the event a dam fails, regardless of whether
it is privately or publicly owned'—is served." Ibid. (citation omitted).
Certainly, the Act does not allow violators to skirt responsibility by the mere
fact of litigation, and CLDC fails to demonstrate how its right to due process
demands such an absurd result.
CLDC also argues that the penalties are impermissible because DEP failed
to "turn square corners" in its dealings with defendants. In support, it cites a
2004 email from the Pines Club president, which claims DEP officials admitted
to him that the dam was safe. That email constitutes uncorroborated double
hearsay, and as discussed, DEP issued several orders and directives to the dam
owners between 1997 and 2003, prior to filing the lawsuit in 2004. Additionally,
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30
in 2004 both the Pines Club and Stephen, who controlled CLDC, commissioned
engineering studies that agreed the dam was not safe. Therefore, CLDC's
argument on this point is not supported by the record.
Next, CLDC suggests it is "fundamentally unfair" to hold it partially liable
for the statutory penalties because the court did not find that it was "exclusively
responsible for repairing and/or maintaining the dam." However, the very nature
of a joint penalty, such as that awarded here, suggests that no single party was
solely responsible for the failure to repair the dam. The Act subjects any
"person" who fails to adhere to any of its provisions, or fails to adhere to an
administrative order, to civil penalties. N.J.S.A. 58:4-6(e). Nothing in the Act
prevents DEP or a court from considering multiple parties to be partially
responsible and jointly subject to civil penalties, and nothing suggests that such
an outcome is fundamentally unfair. See Centennial Land & Dev., slip op. at
35-36.
Additionally, the trial court's joint penalty is not "fundamentally unfair"
because it is largely consistent with the court's earlier ruling allocating
responsibility for funding dam studies and making repairs. The court assigned
10% responsibility to the Pines Club, 45% to Joseph and CLDC, and 45% to
Stephen and Devel. That Joseph, CLDC, Devel, and Stephen are jointly
A-1414-17T3
31
responsible for the penalties is largely consistent with the finding that they are
responsible for the dam in equal measure. 10 Accordingly, CLDC's challenges to
the June 9, 2014 order lack merit.
In sum, CLDC's attempt to re-litigate the propriety of the June 9, 2014
order fails under the law of the case doctrine, and the arguments it raises in this
appeal are meritless. Therefore, we affirm the June 9, 2014 order.
VIII.
Stephen and the Estate next challenge the trial court's entry of final
judgment on October 10, 2017. However, we discern no basis for disturbing it.
Pursuant to Rule 4:42-2, a trial court may enter final judgment regarding
an order subject to enforcement under Rule 4:59 that resolves fewer than all the
claims if: 1) there is no just reason to delay enforcement; and 2) upon either a
complete adjudication of a separate claim, a complete adjudication of all the
10
CLDC also claims that Medford was incorrectly dismissed from the litigation
because it is an "owner" of the dam and should share in the liability with
appellants. However, CLDC did not appeal from the November 30, 2010 order
dismissing Medford from the case. Because "it is clear that it is only the
judgment or orders designated in the notice of appeal which are subject to the
appeal process and review," CLDC "has no right to [this court's] consideration
of this issue." 1266 Apartment Corp. v. New Horizon Deli, 368 N.J. Super. 456,
459 (App. Div. 2004). Moreover, CLDC already unsuccessfully appealed the
November 30, 2010 order in the interlocutory appeal. Therefore, we reject
CLDC's argument on this point.
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rights and liabilities asserted in the litigation as to any party, or where a partial
summary judgment or other order for payment of part of a claim is awarded.
The appealability of a certified final judgment is "an ancillary consequenc e"
compared to the rule's primary purpose of permitting execution by the prevailing
party. D'Oliviera v. Micol, 321 N.J. Super. 637, 641 (App. Div. 1999).
In this case, there is no question that the monetary penalty award is an
order subject to enforcement under Rule 4:59, as it required payment within
sixty days. The parties do not challenge the trial court's finding of no just reason
for delaying enforcement of the civil penalties. Nor do they challenge the court's
finding that DEP's claim for civil penalties under the Safe Dam Act was
completely adjudicated, and that appellants exhausted all avenues of appealing
the underlying penalty order.11
The Estate first argues that the court erred by finalizing the judgment
because the underlying penalty award was defective. As the trial court
explained, and as noted repeatedly herein, defendants already unsuccessfully
appealed the underlying order. Therefore, that argument fails.
11
In its decision, the trial court explained that the only remaining issues are
indemnification claims between the defendants, which will not affect DEP's
penalty award.
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The Estate also argues that entry of final judgment "created an otherwise
avoidable procedural anomaly." It claims the trial court should have issued an
order finalizing the March 9, 2012 order, which declared the parties' respective
liability for funding dam studies and repairs, to prevent confusion as to which
issues are under appellate review. This argument fails because the March 9,
2012 order was part of the interlocutory appeal. Thus, even if the court had
finalized that order, defendants would not be entitled to a second attemp t at
challenging it on appeal. Further, the Estate fails to demonstrate any confusion
caused by the fact that the March 9, 2012 order is not a certified final judgment.
For his part, Stephen does not challenge the entry of final judgment itself.
Rather, he argues that the court erred by awarding interest on the penalties. We
disagree.
Although the June 9, 2014 order required payment within sixty days, the
trial court subsequently granted defendants' request for an extension to O ctober
8, 2014. The court's October 10, 2017 entry of final judgment ordered simple
interest to run from October 8, 2014, in accordance with the annual rates
provided by the Court Rules.
Stephen relies upon a provision of the Act governing the imposition of
civil administrative penalties, N.J.S.A. 58:4-6(d), which limits the applicability
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34
of interest in situations where a civil administrative penalty is contested. He
claims that because the penalty order was "hotly contested," the court's "award
of prejudgment interest on those penalties for any period prior to the date of the
final Order" violated the Act.
As an initial matter, Stephen's reference to prejudgment interest is
misplaced, as the court ordered post-judgment interest running from the date on
which defendants were obligated to make the payment and said nothing
regarding prejudgment interest. Further, the statute Stephen cites only discusses
post-judgment interest. N.J.S.A. 58:4-6(d).
Assuming Stephen intended to argue that the Act precludes a court's
ability to impose post-judgment interest, he misunderstands the difference
between administrative and judicially-imposed penalties. The Act provides
DEP the option of either imposing civil administrative penalties or seeking a
court order imposing penalties. N.J.S.A. 58:4-6(d), -6(e). In this case, DEP
chose the latter option by filing its complaint in the Superior Court.
Accordingly, the action is governed by the Court Rules, not the provision
Stephen cites, which applies to the process of imposing civil penalties in the
administrative context.
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The Court Rules allow for post-judgment interest on all "judgments,
awards and orders for the payment of money." R. 4:42-11(a). Post-judgment
interest is "generally available" for civil penalties authorized by statutes that
provide a cause of action in the Superior Court. United Consumer Fin. Servs.
v. Carbo, 410 N.J. Super. 280, 313 (App. Div. 2009) (holding that trial court did
not sufficiently explain its decision to deny post-judgment interest on civil
penalties issued pursuant to consumer protection statutes). The court's
imposition of post-judgment interest running from the date on which the
payment obligation became past due was thus permissible under the Rules.
Accordingly, we reject appellants' arguments on this point, and affirm the
October 10, 2017 final judgment. 12
Affirmed.
12
As for the balance of any of appellants' arguments not expressly discussed
above, they are without sufficient merit to warrant discussion in a written
opinion. R. 2:11-3(e)(1)(E).
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