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McDade v. Siazon

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


December 8, 2009

MICHAEL MCDADE AND PAMELA MCDADE, PLAINTIFFS-RESPONDENTS,
v.
RODOLFO SIAZON, AURORO SIAZON, COUNTY OF ATLANTIC, AND DEF CONTRACTOR, DEFENDANTS, AND EGG HARBOR TOWNSHIP MUNICIPAL UTILITY AUTHORITY, DEFENDANT-APPELLANT.

On appeal from the Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L-109-08.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued November 9, 2009

Before Judges Rodríguez, Yannotti and Chambers.

By leave granted, Egg Harbor Township Municipal Utilities Authority (MUA) appeals from an order entered by the trial court on April 25, 2008, denying its motion for summary judgment. For the reasons that follow, we reverse.

On January 22, 2006, at approximately 9:00 p.m., plaintiff Michael McDade (McDade) was walking his dog on the sidewalk of Canterbury Road in Egg Harbor Township, New Jersey (Township). McDade allegedly tripped on a pipe that was protruding upward from the sidewalk and fell to the ground. McDade alleges that, as a result of his fall, he sustained injuries to his right shoulder, right knee and right hand, which required surgery and kept him out of work until August of 2006.

McDade consulted an attorney, who forwarded notices of tort claim dated April 13, 2006, to the Township, the County of Atlantic (County) and the State of New Jersey (State). On April 24, 2006, Scibal Associates, Inc. (Scibal), the Township's claims administrator, wrote to McDade's attorney and advised that it was handling the claim. Scibal asked for additional information concerning the claim. On August 17, 2006, Scibal notified McDade's attorney that its investigation "revealed that the pipe sticking out of the sidewalk was a sewer clean-out pipe [that] is under the jurisdiction of the" MUA. Scibal said that the Township had no liability in the matter.

At some point, McDade retained new counsel. On August 22, 2006, McDade's new attorney wrote to the MUA and provided the MUA with a copy of the notice of claim that had been previously served upon the Township, County and State. In a cover letter, counsel stated that the MUA's "governing body" had been notified of the incident on April 13, 2006, by certified mail. Counsel added that he learned on August 21, 2006, that McDade's injury was caused by the MUA's negligence.

Scibal also is the claims administrator for the MUA. On September 15, 2006, Scibal wrote to McDade's attorney and asked for a copy of the "certified mail tag" indicating that the MUA had previously been notified of the claim. Scibal also asked for additional information regarding the claim. On November 20, 2006, McDade's attorney provided Scibal with information concerning the claim, including a photograph of the pipe in question. Scibal responded on December 19, 2006, and advised that it was still investigating the matter. It appears that Scibal never advised McDade's attorney of the results of its investigation.

On January 7, 2008, McDade and his wife Pamela McDade filed a complaint in the Law Division, asserting claims against Rodolfo Siazon and/or Auroro Siazon, the Township, the MUA, the County, DEF Contractor and certain fictitious parties, alleging that they suffered damages as a result of a dangerous and hazardous condition, specifically the pipe protruding upward from the sidewalk on Canterbury Road in the Township.

Plaintiffs alleged, among other things, that the MUA and/or the County "owned, controlled, operated and/or maintained the public sidewalk" in question. They asserted that the MUA and/or the County owed a duty to exercise reasonable care for the safety of pedestrians and "failed to properly discharge [that] duty."

In lieu of filing an answer, the MUA filed a motion for summary judgment and argued that plaintiffs' claims failed as a matter of law because they had not served a notice of claim upon the MUA within the time prescribed by the Tort Claims Act, N.J.S.A. 59:1-1 to 13-10 (TCA). The trial court considered the motion on April 25, 2008, and filed a written opinion on that date in which it concluded that the motion should be denied.

The court applied the discovery rule and determined that plaintiffs' claims against the MUA did not accrue on January 22, 2006, when McDade fell, but on August 21, 2006, when plaintiffs learned that the pipe in question was "actually owned" by the MUA. The court noted that plaintiffs did not conduct any investigation to determine the "true owner of the pipe[.]" The court found, however, that it was "entirely reasonable for a party to believe that a pipe protruding from a sidewalk is owned and maintained by the public entity to whom the public right-ofway for the sidewalk has been dedicated." The court additionally found that the MUA had not shown that it would be prejudiced by applying the discovery rule in this case.

The court accordingly entered an order dated April 25, 2008, denying the MUA's motion for summary judgment. The MUA filed an appeal from the order pursuant to Rule 2:2-3(a). We dismissed the appeal because the order was not a final judgment from which an appeal could be taken as of right and the MUA had not sought leave to appeal pursuant to Rule 2:5-6(a). We later granted the MUA's motion for leave to appeal. McDade v. Egg Harbor Twp. Mun. Util. Auth., No. M-4931-08 (App. Div. May 14, 2009).

The MUA argues that the trial court erred by applying the discovery rule in this case. The MUA maintains that plaintiffs' claims accrued on January 22, 2006, because that is when McDade was injured and he was then aware that someone or some entity may be at fault. The MUA therefore argues that plaintiffs' claims against it failed because they did not serve a notice of claim upon it within ninety days of the accrual date, as required by N.J.S.A. 59:8-8(a), or obtain leave of court to file a late notice of claim pursuant to N.J.S.A. 59:8-9.

The TCA provides that an action may not be brought against a public entity unless the claim upon which it is based has been presented in the manner prescribed by the Act. N.J.S.A. 59:8-3. The TCA further provides that a claim relating to a cause of action for injury to a person shall be presented "not later than the ninetieth day after accrual of the cause of action." N.J.S.A. 59:8-8. Thus, the TCA requires the notice of claim to be served upon the public entity within ninety days of the date when the cause of action accrued.

"Generally, in the case of tortious conduct resulting in injury, the date of accrual will be the date of the incident on which the negligent act or omission took place." Beauchamp v. Amedio, 164 N.J. 111, 117 (2000) (citing Fuller v. Rutgers, The State University, 154 N.J. Super. 420, 423 (App. Div. 1977), certif. denied, 75 N.J. 610 (1978); Torres v. Jersey City Med. Ctr., 140 N.J. Super. 323, 326 (Law Div. 1976)). However, the discovery rule provides an exception to this "well established notion of accrual." Ibid.

The discovery rule is an "equitable principle" that is applied "to avoid the potentially harsh effects of the 'mechanical application' of statutes of limitations." Guichardo v. Rubinfeld, 177 N.J. 45, 51 (2003) (quoting Vispisiano v. Ashland Chem. Co., 107 N.J. 416, 426 (1987)). "The discovery rule delays accrual of a cause of action 'until the injured party discovers, or by an exercise of reasonable diligence and intelligence should have discovered[,] that [he or she] may have a basis for an actionable claim.'" Ibid. (quoting Lopez v. Swyer, 62 N.J. 267, 272 (1973)).

"[T]he discovery rule does not require 'knowledge of a specific basis for legal liability or a provable cause of action,'" but "it does require 'knowledge not only of the injury but also that another is at fault.'" Ibid. (quoting Martinez v. Cooper Hosp.-Univ. Med. Ctr., 163 N.J. 45, 52 (2000)). "'A cause of action does not accrue until both of those factors exist.'" Id. at 52 (quoting Martinez, supra, 163 N.J. at 53).

There is, moreover, a category of "knowledge of fault" cases in which the plaintiff knows that he has been injured and the injury was due to the fault of another but the plaintiff does "'not know that a third party was also responsible'" Ibid. (quoting Martinez, supra, 163 N.J. at 54). If the "plaintiff reasonably remains unaware that an additional third party also may be at fault, 'the accrual clock does not begin ticking against the third party until the plaintiff has evidence that reveals [the third party's] possible complicity.'" Ibid. (quoting Caravaggio v. D'Agostini, 166 N.J. 237, 250 (2001)). The plaintiff nevertheless has a duty to undertake a reasonable investigation to determine whether the plaintiff might have a cause of action against that party. Id. at 54 (citing Caravaggio, supra, 166 N.J. at 250).

As stated previously, in this matter, McDade alleges that he tripped on a PVC pipe that was protruding upward from a sidewalk on Canterbury Road in the Township. When McDade's attorney initially served the notices of claim, he did not undertake any investigation to ascertain the party or parties actually responsible for the pipe. Counsel apparently assumed that the sidewalk was owned by, maintained or controlled by either the Township, County or State and provided timely notices of claim on those entities.

The trial court found that counsel's assumption was reasonable and counsel's failure to undertake an investigation did not preclude application of the discovery rule, thereby deferring the accrual of the claims against the MUA until counsel was told the MUA was responsible for the pipe. We disagree with the court's reasoning and conclusion.

As we have explained, a plaintiff who is injured has a duty to act with "'reasonable diligence and intelligence'" to determine whether he or she has a basis for a claim against potentially responsible parties. Id. at 51 (quoting Lopez, supra, 62 N.J. at 272). It is undisputed that the actual ownership of the pipe in question could have been determined promptly and with little effort. Under these circumstances, it cannot be said that plaintiffs were "reasonably unaware" of the potential claim against the MUA within the time prescribed by N.J.S.A. 59:8-8(a) for serving a notice of claim upon the MUA.

Our conclusion is consistent with Blank v. City of Elizabeth, 162 N.J. 150 (1999). There, as in this case, the plaintiff tripped and fell on a pipe protruding from a sidewalk adjacent to certain residential premises. Id. at 151. The plaintiff's attorney provided a notice of claim to the property owners, who turned the claim over to their insurance carrier. Id. at 152. The carrier informed the plaintiff's attorney that City of Elizabeth owned the pipe. Ibid. Because the plaintiff's attorney was informed of this fact more than ninety days after the accident, he filed a motion pursuant to N.J.S.A. 59:8-9 for leave to file a late notice of claim on the plaintiff's behalf. Ibid.

The Supreme Court noted that the trial court may only grant leave to file a late notice of claim if the plaintiff establishes sufficient reasons constituting "extraordinary circumstances" for failing to serve the notice within the required ninety days. Id. at 151. The Court said that the pipe "was in fact a round, metal shut-off valve protruding above the sidewalk that, on visual inspection, readily would have been identified as an appurtenance of a water supply system." Id. at 152. The Court stated that "an inspection of the area within a reasonable time following the accident would have led promptly to the identification of the public entity defendants that were responsible for installation and maintenance of the shut-off valve." Id. at 152-53.

Although Blank decided that the failure to identify the public entities responsible for the pipe did not constitute "extraordinary circumstances" for the filing of a late notice of claim under N.J.S.A. 59:8-9, the court's reasoning also applies in determining whether the discovery rule should be applied in this case. Here, as in Blank, an investigation of the pipe would have led promptly to the identification of the MUA as a party potentially responsible for plaintiffs' alleged injuries. Because such an investigation was not undertaken, plaintiffs cannot be said to have been "reasonably unaware" that the MUA was a potentially responsible party within the statutorily-prescribed time for serving a notice of claim.

Plaintiffs argue, however, that the MUA failed to establish the it would be prejudiced by application of the discovery rule in this case. Indeed, as we have pointed out, the trial court found that the MUA had not shown that it had been prejudiced by the late notice of claim. However, prejudice to the defendant is only one factor to be considered in determining whether to apply the discovery rule. Lopez, supra, 62 N.J. at 274-76. Because plaintiffs could have promptly discovered through the exercise of reasonable diligence that they had a claim against the MUA, there is no basis for applying the discovery rule in this case.

Plaintiffs also argue that it is undisputed that they provided a timely notice of claim to the Township. They assert that notice to the Township constitutes sufficient notice to the MUA. Plaintiffs point out that the Township and the MUA have offices in the same building. They also point out that Scibal is the claims administration for both entities. However, the Township and the MUA are separate and distinct public entities. Under the TCA, notice to the Township is not notice to the MUA.

Plaintiffs additionally argue that the MUA is equitably estopped from raising the lack of timely notice as a defense to plaintiffs' claims. Plaintiffs assert that after they provided the MUA with the notice of claim on August 22, 2006, the MUA's claim administrator advised their attorney that the claim was being investigated. Plaintiffs note that the MUA never advised them of the results of the investigation, nor did the MUA state that it was denying the claim on technical grounds.

Again, we disagree. Plaintiffs' estoppel claim fails because it cannot be said that plaintiffs detrimentally relied upon the MUA's statement that it was investigating their claim. Furthermore, the MUA never informed plaintiffs that it believed the notice of claim was timely served.

We therefore conclude that the trial court erred by applying the discovery rule to plaintiffs' claims against the MUA. Plaintiffs' cause of action accrued on January 22, 2006, the date of the accident. Because plaintiffs failed to serve the MUA with a notice of claim within ninety days of the accrual date, as required by N.J.S.A. 59:8-8(a), and did not obtain leave to file a late notice of claim pursuant to N.J.S.A. 59:8-9, they are barred from pursuing their claims against the MUA in this case.

Reversed and remanded for entry of an order dismissing the claims against the MUA with prejudice.

20091208

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