The Third Circuit has specifically addressed a public nuisance claim against a successor landowner. See Hercules, 762 F.2d at 315. In Hercules, it admonished:
In analyzing the public nuisance claim, we are not concerned with the happenstance that [the plaintiff] now occupies the very land [the prior owner] occupied when it allegedly created the condition that has polluted the . . . waters, or that the continuing source of that pollution is located on that land. The question before us is whether [the plaintiff] has standing to bring an individual action for damages or injunctive relief for interference with a public right.
I find that Klockner has sufficiently alleged a claim for public nuisance. In its Cross-claim, Klockner alleged interference with a public right, that is, the right of all members of the community to uncontaminated water from the Rockaway aquifer. See id. at 316 (right to "pure water" is a public right). Klockner has also adequately alleged special injury, that is, that it has been deprived of the use and enjoyment of that portion of the aquifer located beneath its property. Because it alleged interference specifically with that portion of the aquifer located beneath its property, it has alleged an injury different from that suffered by the public in general. Moreover, Klockner sustained harm in the exercise of a right common to the general public since it does not have a proprietary interest in the groundwater located beneath its property. See Woodsum v. Pemberton Township, 172 N.J. Super. 489, 502, 412 A.2d 1064 (Law Div. 1980), aff'd, 177 N.J. Super. 639, 427 A.2d 615 (App. Div. 1981).
Moreover, the Third Circuit has recognized that injury to a business operation as a result of pollution may constitute special injury. See Hercules, 762 F.2d at 316 (special injury "where an established business made commercial use of the public right with which the defendant interfered") (quoting Prosser, Private Action for Public Nuisance, 52 Va. L. Rev. 997, 1013-14 (1966)). Here, Klockner has alleged that it has suffered and continues to suffer substantial business losses as a result of Thiokol's contamination of the aquifer located beneath the Klockner Property.
Thiokol relies on Amland Properties Corp. v. Aluminum Co. of America, 711 F. Supp. 784, 809 (D.N.J. 1989), and Hercules for its argument that a subsequent landowner cannot recover under a public nuisance theory for damages sustained by a predecessor occupant. However, its reliance on these two cases is misplaced. In both cases, the plaintiff sought to recover its costs of cleaning up its property. This was held insufficient to support a public nuisance claim since the harm was not sustained in the exercise of a right common to the general public. Hercules, 762 F.2d at 316. Here the harm allegedly sustained, interference with Klockner's use of the aquifer located beneath its property and the resulting harm to its business, was harm sustained in the exercise of a public right, i.e., the right to uncontaminated water from the aquifer.
Because Klockner has sufficiently alleged the elements of a public nuisance claim, Thiokol's motion to dismiss this count is denied.
4. Claim for Private Nuisance
Count V alleges a claim for private nuisance. According to the Cross-claim, Thiokol was a tenant on the Klockner Property from 1949 to 1970. Klockner alleges that Thiokol's activities on the property while it was a tenant constitute a private nuisance to Klockner. Thiokol seeks to dismiss this claim on the ground that private nuisance is unavailable to a successor landowner.
Under New Jersey law, a private nuisance consists of an interference with one's interest in the private use and enjoyment of land. PPG, 644 F. Supp. at 1264 (citing Birchwood Lakes Colony Club, Inc. v. Borough of Medford Lakes, 90 N.J. 582, 591-92, 449 A.2d 472 (1982)). Private nuisance, however, applies only to interference with use of adjoining land. Amland, 711 F. Supp. at 808. In other words, private nuisance is confined to situations where one person's property use interferes with another's use of neighboring or adjoining property. Id. at 807 (citing Restatement, § 822, comment g); see Hercules, 762 F. Supp. at 314 (noting "historical role of private nuisance law as a means of efficiently resolving conflicts between neighboring, contemporaneous land uses."); Ventron, 94 N.J. at 489 (noting traditional rule that nuisance involves interference with neighboring land); Sarnicandro v. Lake Developers, Inc., 55 N.J. Super. 475, 481, 151 A.2d 48 (App. Div. 1959) (private nuisance claim will not lie where no interference with adjoining land); see also Frola, 730 F. Supp. at 634 ("the New Jersey courts and this Court, when applying New Jersey law, have adhered to a narrow application of private nuisance theory . . . "). Thus, a successor landowner is precluded from asserting a public nuisance claim against a predecessor landowner.
Klockner contends, however, that the principle set forth above applies only to successive landowners, and does not apply to the landlord-tenant situation. It argues that at the time of the alleged contamination, Klockner held title to the Klockner Property. Thus, it reasons that any contamination by Thiokol while it was a tenant on the Property "interfered with Klockner's contemporaneous use and enjoyment of its property, which continues today." Klockner Br. at 22-23. I disagree. As noted above, the rule in New Jersey is that a claim for private nuisance requires an interference with adjoining land. Moreover, this rule has been applied in the landlord-tenant situation. See Frola, 730 F. Supp. at 634. Finally, Klockner has provided no reason why a different rule should apply to a landowner-tenant situation and has not cited a single case in support of its position.
Because private nuisance is unavailable to Klockner under the circumstances alleged in its Cross-claim, Count V must be dismissed for failure to state a claim.
5. Claim for Unjust Enrichment
Count XVIII alleges a claim for restitution and unjust enrichment. Klockner alleges that it has incurred response costs for investigating and partially remediating the contamination on the Klockner Property in order to obtain ECRA clearance to sell the Property, and that Thiokol has been unjustly enriched because Klockner alone has incurred these clean-up costs. Cross-claim at PP 27, 33-36.
There are two elements of a claim for unjust enrichment: 1) that the plaintiff received a benefit; and 2) an injustice would result if the plaintiff retained the benefit without paying for it. Associates Commercial Corp. v. Wallia, 211 N.J. Super. 231, 243, 511 A.2d 709 (App. Div. 1986); Callano v. Oakwood Park Homes Corp., 91 N.J. Super. 105, 108, 219 A.2d 332 (App. Div. 1966).
Thiokol alleges that because Klockner had a legal obligation to investigate and clean up its property in order to obtain ECRA clearance, Klockner did not confer any benefit on Thiokol when it took action on its property. It asserts that because there has been no enrichment, Klockner's claim must be dismissed. I agree.
As noted above, Klockner alleges that it incurred the costs in order to obtain clearance under ECRA so that it could sell its property. Once Klockner decided to sell its property, it triggered obligations under ECRA. See Superior, 216 N.J. at 64. "The transfer triggers ECRA, imposing a regulatory obligation on the current owner before transfer to develop, and, if necessary, to implement a cleanup plan. This obligation proceeds without regard to responsibility for the contamination itself." Id. Thus the costs Klockner incurred were the result of its own decision to transfer its property. Clearly, under these circumstances, no benefit was conferred upon Thiokol.
The reasoning of Smith Land & Improvement Corp. v. Rapid-American Corp. is pertinent here. 26 Env't Rep. Cas. (BNA) 2023 (M.D.Pa. 1987), vacated on other grounds, Smith Land & Improvement Corp. v. Celotex Corp., 851 F.2d 86 (3d Cir. 1988), cert. denied, 488 U.S. 1029, 102 L. Ed. 2d 969, 109 S. Ct. 837 (1989). In that case, the plaintiff sought reimbursement from the prior owner of contaminated property for the costs it incurred when it was required by the EPA to clean up the property. The court stated:
just because the EPA chose the plaintiff to do the clean-up work, does not mean that the defendant was enriched. The plaintiff continually argues that the defendant was spared the clean-up costs. Yet the plaintiff fails to realize that it was equally responsible to clean up its land.
Id. at 2026.
The facts before me present an even stronger case than in Smith Land. In Smith Land, both the plaintiff and defendant were equally responsible to clean up the property under CERCLA. Here, only Klockner had an obligation under ECRA to clean up the Property in order to obtain clearance for the contemplated sale.
I therefore find that Klockner's claim for unjust enrichment fails to state a claim for relief and must be dismissed.
6. Claim for Fraudulent Concealment
Count X of Klockner's Cross-claim sets forth a claim for fraudulent concealment. Thiokol moves to dismiss this count on the ground that Klockner has not complied with the special pleading requirements of Rule 9(b) of the Federal Rules of Civil Procedure.
The purpose of Rule 9(b) is to "place the defendants on notice of the precise misconduct with which they are charged, and to safeguard defendants against spurious charges of immoral and fraudulent behavior." Seville Indus. Machinery Corp. v. Southmost Machinery Corp., 742 F.2d 786, 791 (3d Cir. 1984), cert. denied, 469 U.S. 1211, 84 L. Ed. 2d 327, 105 S. Ct. 1179 (1985). Under Rule 9(b), a plaintiff must plead fraud with particularity. Rule 9(b) states, in relevant part:
In all averments of fraud . . . the circumstances constituting fraud . . . shall be stated with particularity. Malice, intent, knowledge, and other condition of mind of a person may be averred generally.
The Third Circuit has held that "focusing exclusively on [Rule 9(b)'s] particularity language is too narrow an approach and fails to take account of the general simplicity and flexibility contemplated by the rules." Seville, 742 F.2d at 791 (quoting Christidis v. First Pennsylvania Mortgage Trust, 717 F.2d 96, 100 (3d Cir. 1983)). Rule 9(b) must be interpreted alongside Rule 8(f), which requires a court to construe pleadings "as to do substantial justice." Id.
Accordingly, "while allegations of date, place or time fulfill [Rule 9(b)'s] functions, . . . nothing in the Rule requires them." Id. Rather, "plaintiffs are free to use alternative means of injecting precision and some measure of substantiation into their allegations of fraud." Id.
More recently, the Third Circuit again addressed the standard for pleading fraud under Rule 9(b) in Shapiro v. UJB Financial Corp., 964 F.2d 272, 285 (3d Cir.), cert. denied, 121 L. Ed. 2d 278, 113 S. Ct. 365 (1992). The Court held that when information necessary to plead fraud with particularity is exclusively within the defendants' control, a plaintiff may survive a motion to dismiss by specifically alleging that defendants have exclusive control over the information required. The plaintiff must accompany its allegation with a statement of facts upon which the allegation of fraud is based and delineate the nature and scope of its efforts to obtain the information needed to plead fraud with particularity.
In its Cross-claim, Klockner alleges that while Thiokol was a tenant on the Property it contaminated the Property and that it failed to remove the underground tanks containing hazardous wastes upon its departure. Cross-claim at PP 21, 107. It also alleges that the defendants, as Klockner's tenants, knew or should have known of the contamination they caused during their leaseholds, id. at P 98, that defendants "deliberately and fraudulently failed to disclose" to Klockner the existence of the contamination and that Klockner justifiably relied on this non-disclosure. Id. at P 99.
Applying the principles set forth above to the allegations of the Cross-claim, I find that Klockner has not pled its claim with sufficient particularity. To begin with, Klockner has not particularized in any way its allegation of fraudulent concealment. It simply makes a blanket statement that the defendants "deliberately and fraudulently failed to disclose" the contamination. Klockner has essentially pled the elements of a claim for fraudulent concealment without describing any factual predicate supporting each element. In other words, it is impossible to tell from the count what the underlying facts are that gave rise to the alleged acts of fraudulent concealment. Although it is not necessary to plead the date, place or time of the acts of fraudulent concealment, the plaintiff must nevertheless provide some factual substantiation of its allegations of fraud. Klockner has not done so here.
Moreover, Klockner has grouped all the defendants together in its count for fraudulent concealment without specifying the precise misconduct associated with each defendant. Klockner cannot simply "lump" all the defendants together and allege generally that they all committed fraudulent concealment. Where multiple defendants are charged with fraudulent concealment, "the complaint must inform each defendant of the specific fraudulent acts which constitute the basis of the action against the particular defendant." Coronet Ins. Co. v. Seyfarth, 665 F. Supp. 661, 666 (N.D. Ill. 1987).
Klockner argues, however, that it has separately stated the wrongful activities in which each defendant engaged, albeit not within the count itself. For example, Paragraph 21 of the Cross-claim states that Thiokol discharged hazardous substances at the Klockner Property. This argument is misplaced, however. The acts Klockner has separately alleged as to each defendant are not the acts that constitute the fraudulent concealment; rather Klockner has separately alleged the acts of pollution. However, it is the acts of fraud forming the basis of the fraudulent concealment claim that need to be particularized. See Coronet, 665 F. Supp. at 666 ("complaint must inform each defendant of specific fraudulent acts") (emphasis added).
Finally, Klockner has not delineated its attempts to investigate the action to be able to plead fraud with more particularity and has not alleged that necessary information is within the defendants' exclusive control.
Therefore, in light of the above, I find that Klockner simply has not pled this count with the specificity required by Rule 9(b). The claim as it now stands will be dismissed without prejudice. However, this court will stay the dismissal for thirty days from the date of this Order to allow Klockner to amend its claim if it so chooses in accordance with the principles set forth above. See Saporito v. Combustion Engineering Inc., 843 F.2d 666, 675 (3d Cir. 1988) (leave to amend should be granted in order to allow the pleader an opportunity to provide greater specificity), vacated on other grounds, 489 U.S. 1049 (1989).
7. Claim of Contribution
Count XX alleges a claim for contribution for past and future costs which Thiokol, as the alleged actual tortfeasor, caused Klockner to incur. Cross-claim at PP 155-156. The count is labeled as "Common Law Contribution."
Thiokol argues that no common law contribution right of action exists under New Jersey law. Rather, the right to contribution is governed exclusively by the New Jersey Joint Tortfeasors Act, N.J.S.A. 2A:53A-1, et seq. Thiokol argues that Klockner has not alleged a cause of action under the Tortfeasors Act, and therefore Count XX fails to state a claim for relief.
In its opposition papers, Klockner concedes that there is no common law right to contribution in New Jersey and that it made a mistake by labelling the claim as a common law claim. I find that this mistake is not fatal to the count.
See Alexander v. Unification church of America, 634 F.2d 673, 678 (2d Cir. 1980) (mislabelling of count is immaterial under Federal Rules of Civil Procedure). Rule 8 of the Federal Rules merely requires a pleading to give the defendant fair notice of the claims asserted against it. See Conley, 355 U.S. at 47. I find that the allegations of the Cross-claim provide Thiokol with fair notice that Klockner is seeking a claim for contribution. There is no requirement that the count specifically refer to the statutory basis for the action as long as the allegations otherwise give fair notice.
I therefore find that the Count XX states a claim for relief for contribution under the Tortfeasors Act and will deny Thiokol's motion to dismiss this count.
For the foregoing reasons, I grant Thiokol's motion to dismiss Rockaway's Complaint for failure to state a claim as to Count I (CERCLA claim as to injunctive relief) and Count II (CERCLA natural resource damage claim).
I also grant Thiokol's motion to dismiss Klockner's Cross-claim as to Count V (private nuisance); Count XVIII (unjust enrichment); and Count X (fraudulent concealment). With respect to Count X (fraudulent concealment), however, Klockner will have 30 days from the date the Order is signed to amend this count.