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Birchwood Lakes Colony Club Inc. v. Borough of Medford Lakes

Decided: May 28, 1981.


On appeal from Superior Court, Law Division, Burlington County.

Seidman, Antell and Lane. The opinion of the court was delivered by Seidman, P.J.A.D.


Plaintiff, an organization representing the residents of the Birchwood Lakes area in the Town of Medford, filed a complaint against the Borough of Medford Lakes in July 1975 for compensatory damages resulting from the pollution of a lake by effluent from the borough's sewage treatment plant and also for injunctive relief under the Environmental Rights Act, N.J.S.A. 2A:35A-1 et seq. Recovery was sought for the cost of treating the lake with chemicals and of dredging it to remove the accumulation of algae and aquatic plants.

At the conclusion of a lengthy trial of the damage action the jury, in response to interrogatories submitted to it by the trial judge, found the borough negligent in "failing to discharge a duty to take corrective steps to prevent the excessive discharge of nutrients from its sewer plant," and in failing to observe the conditions of a permit issued in 1974 by the United States Environmental Protection Agency under the provisions of the Federal Water Pollution Control Act, 33 U.S.C.A. §§ 1251-1376. Damages were awarded to plaintiff in the amount $45,000. Subsequently, the trial judge granted plaintiff's motion for an award of $2,500 for expert witness fees, but denied its request for injunctive relief and also denied defendant's motion for a new trial.

The borough appealed from the adverse judgment and from the award of expert witness fees. The principal issue involves the tort liability of a municipality for pollution of a private lake by effluent from its sewage treatment plant. We address first, however, the fee award.

The $2,500 award was clearly erroneous. The statute invoked by plaintiff in support of its application, the Environmental Rights Act, N.J.S.A. 2A:35A-1 et seq. , empowers any person to maintain an action in a court of competent jurisdiction to enforce or to restrain the violation of any statute, regulation or ordinance designed to prevent or minimize pollution, impairment or destruction of the environment. N.J.S.A. 2A:35A-4.

There is no provision in the act for the recovery of money damages. However, the act does not supersede any existing civil remedy available to any person. N.J.S.A. 2A:35A-12. On the matter of fees, the court is authorized in any action under the act to award the prevailing party reasonable counsel and expert witness fees not exceeding a total of $2,500. N.J.S.A. 2A:35A-10. To the extent that the complaint here sought injunctive relief, it was plainly an action under the act. But since such relief was denied by the trial judge, plaintiff was not the prevailing party in such action; consequently, the underpinning for the award of expert witness fees was lacking. The order granting such fees must therefore be reversed.

Turning to the liability issue, we summarize the relevant facts, most of which are substantially uncontroverted. The borough constructed and began operating a sewage treatment plant in 1939. The plans were approved by the State Department of Health, which had jurisdiction at the time. Extensive alterations and improvements were made in 1964 or 1965. As before, the plans were approved by the Department. The result was "[b]asically a complete new plant leaving a couple of the items from the original plant." Treated sewage effluent from the plant flowed into an adjacent stream and then for a distance of approximately 500 feet into Birchwood Lake, a privately owned body of water that had been created out of a cranberry bog in the 1950's. Residents of the Birchwood Lakes area began to notice mats of algae in the lake in 1969. By the early 1970s the lake had become unusable for swimming, fishing or canoeing because of the proliferation of algae and aquatic plants. Following complaints by concerned lakeside residents, an investigation of the problem was conducted under the supervision of Frank Takacs, Principal Biologist of the Division of Water Resources, Department of Environmental Protection, from November 1971 to February 1972.

A report was issued in March 1972. It described the lake as a shallow, artificial impoundment of water in which nutrients tend to accumulate, thereby increasing the potential of biological

growth and influencing the eutrophication of the lake.*fn1 Because phosphorus, of which one-third is phosphate and which is present in low concentration in most natural bodies of water, is essential to plant growth processes, eutrophication in impoundments is controlled by the reduction of phosphorus input. Phosphorus concentrations should not exceed .05 mg. per liter where streams enter a lake, reservoir or other standing body of water. The input of phosphorus into the lake here involved was directly affected by the plant effluent. The flow contained phosphorus substantially in excess of the Department's standards. Takacs recommended that the plant should "cease, resolve and control the discharge of excessive phosphorus concentrations into the waters of Upper Birchwood Lake."

On September 27, 1972 the Department of Environmental Protection issued an order, the preamble of which stated that the sewage treatment plant "is inadequate in unit design to properly care for, treat and dispose of sewage" before the effluent is discharged into the lake and ultimately "to the Southwest Branch of Rancocas Creek, a tributary to the Delaware River," thereby "causing or threatening injury to the inhabitants of this State either in their health, comfort or property in violation of R.S. 58:12-2." The order stated further that "the sewage treatment plant must be altered in a manner approved by" the Department. The borough was directed to "initiate and thence make such disposition of its sewage" prior to December 31, 1972, as would be approved by the Department. The abatement of the pollution was to be "accomplished in a manner as to be in conformity with" the Department's water quality management plan for the area.

The borough's attorney objected to the order, stating that it was "unclear and ambiguous" and that "the governing body has an obligation . . . to spend their money wisely . . . ." Correspondence was exchanged and meetings were held to discuss the abatement of the pollution by removing phosphates from the effluent. Negotiations between the borough and the Department led to the Department's issuance of a construction permit in June 1974 for additions and improvements to the plant. The borough adopted an ordinance authorizing the capital improvement and appropriating the sum of $74,000 to be raised by the issuance of bonds. Specifications were prepared and bids were solicited, but all the bids received were considerably in excess of the estimated cost and were rejected.

The Department continued to press the borough to act and then filed a suit to compel the borough to abate the pollution. A consent judgment was entered June 27, 1977. It provided that by August 22 of that year the borough would obtain a federal public works grant to finance the construction of an experimental nutrient control pond and the conventional chemical treatment plant for which the Department had issued a permit in June 1974. Upon the receipt of the award and all necessary governmental approvals the borough would immediately construct the facilities for which funding was received. If the federal grant was not forthcoming, the borough would proceed forthwith to construct and operate the nutrient control pond pending the completion of the ongoing study of regional sewage treatment needs and facilities. If the study recommended upgrading the sewage treatment plant, the borough would have one year to obtain federal funding, otherwise the borough would have to finance and implement the upgrading itself. Finally, the borough agreed that if the regional study should recommend that the borough abandon its existing facilities and join a regional sewage treatment system, it would comply. The time for implementing the consent judgment was thereafter extended to August 31, 1978, with all construction to

be completed by January 2, 1979. The record does not disclose the current status of the matter.

At the trial plaintiff advanced several theories of negligence on the part of the borough, all of which were submitted to the jury for consideration, together with written interrogatories: active wrongdoing prior to July 1, 1972 (the effective date of the Tort Claims Act, N.J.S.A. 59:1-1 et seq.) which was a proximate cause of plaintiff's damage; negligent construction of the sewage treatment plant; actual or constructive knowledge by defendant that it was operating the plant "in a manner which was damaging plaintiff's lake by reason of which a duty arose, a duty on the part of the defendant, to correct the problem" and defendant's failure to discharge its duty resulting proximately in the damages complained of; defendant's failure to observe the conditions of the federal operating permit, to obey the departmental order and to obey the consent judgment, and negligent operation by defendant of the sewage treatment plant. Defendant voiced no objection to the trial judge's instructions to the jury, so that any complaints now made with respect to them would come to us on a claim of plain error. Although the correctness of portions of the charge is debatable, the jury's responses to the interrogatories mooted to an extent such errors in the charge as may have existed and, moreover, significantly narrowed the scope of the appeal.

The jury was asked to state whether defendant was negligent in the operation or in the planning and design of the sewage treatment plant. The response to each inquiry was "No." Another interrogatory, also answered in the negative, was whether defendant was negligent "in the response to the Department of Environmental Protection Order" issued in September 1972. There was an affirmative answer to the further inquiry whether defendant was negligent "in its response to the Department of Environmental Protection Judgment" entered in July 1977, but the jury also found that such negligence was not a proximate cause of any damage.

The jury answered "Yes" to the remaining interrogatories:

Was the defendant negligent in failing to discharge a duty to take corrective steps to prevent the excessive discharge of nutrients from its sewer treatment plant?

Was the defendant negligent in failing to observe the conditions of its operating permit? (Issued May 30, 1974)

Taking into consideration all of the theories advanced by Plaintiff, or several of these theories (but less than all), do you find the Defendant has been negligent with respect to those theories?

In each of these instances the jury also determined that the negligence was a proximate cause of the damage.

The finding of negligence with respect to the federal permit issued in May 1974 warrants scrutiny since it is apparent to us that there is insufficient factual support in the record for either the submission of the issue to the jury or its response thereto. The permit, entitled "National Pollutant Discharge Elimination System -- Permit to Discharge," was effective for a five-year period commencing May 30, 1974. It authorized the permittee to discharge pollutants in compliance with the provisions of the Federal Water Pollution Control Act, 33 U.S.C.A. §§ 1251-1376. Such discharge of pollutants was governed by the general conditions set forth in the permit and the effluent limitations specified therein. It is unclear whether the permit was intended to cover the existing sewage treatment plant or was limited to the proposed enlargement and alteration for which the construction permit was issued by the Department of Environmental Protection on March 6, 1974. In any event, we surmise that the alleged failure by the borough to observe the "conditions of its operating permit" pertained to the ...

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