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Garden State Flower Market, Inc. v. Lederman

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


June 21, 2010

GARDEN STATE FLOWER MARKET, INC., PLAINTIFF-APPELLANT,
v.
LEE R. LEDERMAN, ESQ., THE LAW OFFICE OF LEE R. LEDERMAN, DEFENDANTS, AND EAST COAST ENGINEERING, INC. AND ROBERT HARRINGTON, P.E., DEFENDANTS-RESPONDENTS.

On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-1503-05.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted June 3, 2010

Before Judges Kestin and Newman.

Plaintiff Garden State Flower Market, Inc., appeals from an order dismissing with prejudice the professional malpractice action against defendants East Coast Engineering, Inc., and Robert Harrington, P.E. The legal malpractice action against defendant Lee R. Lederman and his law office was settled and is not a part of this appeal. We now affirm.

In August 2000, plaintiff retained defendants East Coast Engineering, Inc., and Robert Harrington, P.E., to provide comprehensive engineering services to develop a piece of real estate on U.S. Route 9 in Howell Township for use as both commercial and residential property. Plaintiff contemplated moving its florist operation to the location as a retail and wholesale outlet.

Initially, it was contemplated that a septic system could be utilized in servicing the property. However, it was apparent by November 14, 2001, that was not feasible and a sewer extension was needed. The site was bounded by a stream on one side and wetlands on another. The connection to the Township's sanitary sewer system was deemed necessary because the existing septic and the demands of the intended use and available space rendered the septic system inadequate to accommodate the use and incapable of expansion because of its proximity to the stream and wetlands. There was, however, no sanitary sewer system within close proximity for connection.

Several options had to be explored. Extending to a main sewer line near Route 9 was not feasible from an engineering and cost basis. The extension of the sewer line to a residential development located behind the property required it to be run through wetlands at the rear of the subject property. This was the option selected. Defendants then had to obtain authorization from state, county, and municipal agencies to construct a sanitary sewer connection through the wetlands. The Township finally agreed to the extension. The approval, however, required a signature from the property owner on the final applications. That signature was not forthcoming when the applications were presented in June 2003. Plaintiff's contract to purchase the property had expired and there was no further extension of that agreement. There was no requirement in the contract that final site plan approval was a condition to the closing of the real estate transaction.

In claiming that defendants failed to perform their professional duties to obtain the regulatory approvals and permits from the agencies governing development of the property, plaintiff produced the report of John E. Tesoriero, a professional engineer. He was of the opinion that defendants failed to obtain the necessary approvals for a sewer extension to serve the existing two buildings with proposed improvements. He considered the "extremely long time period unreasonable causing plaintiff to default on his contract to purchase the property and incurred damages."

To buttress his opinion, Tesoriero recited that plaintiff was not knowledgeable in the engineering aspects of the work involved and reasonably relied on defendants to provide engineering services. He noted that defendants failed to prepare and file the applications in a reasonable and timely manner with the appropriate regulatory agencies for approval of the proposed sewer extension. He also asserted that they failed to properly communicate with plaintiff concerning the sewage extension permitting procedures and did not exercise due diligence to make appropriate inquiry into the permitting and procedures necessary to secure a sewer extension from the Howell Township Council, Howell Township Water and Sewer Department, New Jersey American Water, Manasquan River Regional Sewerage Authority (M.R.R.S.A.), Ocean County Utility Authority (O.C.U.A.), and New Jersey Department of Environmental Protection (NJDEP).

In addressing the motion to bar the allegations of professional negligence as being a net opinion and dismissing plaintiff's complaint and cross-claims, the trial court discussed the net opinion rule, noting that it "is a prohibition against speculative testimony." Grzanka v. Pfeifer, 301 N.J. Super. 563, 580 (App. Div.), certif. denied, 154 N.J. 607.

The court continued: "'Under this doctrine, expert testimony is excluded if it is based merely on unfounded speculation and unquantified possibilities.' [Ibid.] Therefore, 'the net opinion rule appears to be a mere restatement of the established rule that an expert's bare conclusions unsupported by factual evidence, [are] inadmissible.'" Ibid.

In discussing this case specifically, the court stated:

Here, while defendant contends that plaintiff's expert's opinions are based on a substantially and fatally incomplete review of the facts, plaintiff asserts that Mr. Tesoriero's report lays out more than three pages of typed single space setting forth the various facts upon which he based his conclusions. However, it is uncontested that Mr. Tesoriero (1) did not review the timing and interaction of all aspects of the project including wetlands delineation and DEP and EPA approvals and the impact they had on the sewer extension permit application; (2) did not inquire as to whether Howell Township had published requirements for sewer permit applications; (3) did not review the correspondence exchanged between East Coast Engineering, Mr. Petrelesse, Mr. La France, or Mr. Lederman; (4) did not perform any analysis of the timeframe for the above communications to determine whether they were reasonable or not; (5) did not know where the property was located, or whether it was in a residential, commercial, or dual use zoned area; (6) did not know that it was necessary to cross wetlands and a stream to make a connection. Based upon these deficiencies, and others cited in defendant's moving papers and at oral argument[,] it appears to the court that Mr. Tesoriero based his opinion upon an incomplete record and not upon a reasoned objective review of the relevant information upon which to base his opinion that the defendant's delay in processing the sewer extension permit caused plaintiff's damages. In other words, the court finds that Mr. Tesoriero failed to link plaintiff's damages to the actions or inactions of the defendant. Also, there is nothing on the record before the court that establishes that the failure to obtain the site plan approval was in any way related to the reason plaintiff did not close on the real estate transaction. Therefore, the court finds that the opinions rendered by plaintiff's expert are "net opinions."

As to plaintiff's assertions that this matter is a "common knowledge" case and, therefore, this case can proceed against the within defendants, the court disagrees. The court finds that the crux of this case revolves around whether a professional engineer deviated from accepted standards of care. It is apparent to the court that it is beyond the ken of the average juror to determine whether the defendant deviated from the accepted practices as professional engineer in determining the local permit application procedures, especially in a municipality that did not follow conventional practice with respect to management of its sewer systems.

The court granted defendants' motion in its entirety.

On appeal, plaintiff raises the following issues for our consideration:

POINT I

THE TRIAL COURT ERRONEOUSLY BASED ITS DECISION ON EXTRANEOUS MATTERS THAT WERE NOT PROPERLY BEFORE THE COURT.

POINT II

THE TRIAL COURT ERRED IN FINDING THAT MR. TESORIERO'S EXPERT OPINION WAS A "NET OPINION."

POINT III

ASSUMING, ARGUENDO, THAT MR. TESORIERO'S EXPERT OPINION IS DISREGARDED, THE CASE SHOULD NOT BE DISMISSED BECAUSE THE FACTS OF THIS CASE ARE SUCH THAT AN EXPERT'S OPINION IS NOT NEEDED TO SEE THE OBVIOUS FAULT ON THE PART OF THE RESPONDENTS.

We affirm substantially for the reasons expressed in Judge Waldman's written opinion which accompanied the order of May 14, 2008, barring allegations of professional negligence and dismissing plaintiff's complaint and all cross-claims with prejudice. We add, however, these comments.

Plaintiff asserts that the issue of proximate cause was not encompassed within the motion brought to bar the net opinion offered by plaintiff's engineering expert. While professional negligence is a deviation from a standard of care, it would be meaningless if it did not lead to injury or damages. Here, there is no evidence establishing that site plan approval was the reason plaintiff did not close on the subject property. Indeed, it was admitted that there was no requirement that final site plan approval was a condition to closing. Therefore, any alleged deviation was meaningless in the absence of any damages. This issue was encompassed in the motion before the trial court and was properly addressed.

While the issue of proximate cause is usually one for a jury, here there was no dispute as to whether site plan approval was necessary in order to close on the property. It was agreed that it was not necessary. Consequently, the trial court properly ruled on the issue.

With regard to plaintiff's expert's opinion, there was no reference to any manual or code that established any standard of care. Mr. Tesoriero's opinion was based on his experience in the field for a considerable period of time. However, he did not base his opinion on the facts as they unfolded in this case. The original plan was to use the septic system. When that was abandoned, a connection to the sanitary sewer system had to be explored. The only feasible option required crossing wetlands which brought more regulatory agencies into the approval process.

Defendants also learned that, unlike other municipalities, the control and governance of the sewer system had been outsourced to a private entity, New Jersey American Water Company, which was initially unaware that it had such supervisory authority. All of these various steps in the process of applying for the permit were not considered by plaintiff's expert. His opinion amounted to no more than indicating that he could have done the work faster. That is no standard other than his own personal opinion. The opinion, while it has been called a net opinion, could just as easily have been labeled a personal opinion.

Lastly, with regard to the contention that this case could invoke the common knowledge doctrine, we disagree. The lay population cannot be imputed to have knowledge of what is involved in determining whether a sewer extension was even feasible, much less know the procedure for obtaining a permit to construct one. The general population would have to know how long the process would take with the various layers of governmental approval necessary once the decision was made to connect to the sewer system. That is well beyond the scope of a lay person's knowledge. As Justice Handler said in Rosenberg by Rosenberg v. Cahill, 99 N.J. 318, 325 (1985), we "agree with the lower court[] that the common knowledge doctrine [i]s not available under these facts and does not obviate the need for competent expert testimony to establish the applicable duty of care[.]"

Affirmed.

20100621

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