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Intermodal Properties, LLC v. Norfolk Southern Railway Company


February 9, 2012


On appeal from the Superior Court of New Jersey, Chancery Division, Hudson County, Docket No. C-111-08.

Per curiam.


Argued October 25, 2011

Before Judges Yannotti, Espinosa and Kennedy.

Intermodal Properties, L.L.C. (Intermodal) appeals from an order entered by the Chancery Division on February 3, 2010, dismissing its complaint against defendant Norfolk Southern Railway Company (Norfolk) with prejudice. We affirm.

Intermodal is the owner of approximately 5.88 acres of property in Secaucus, New Jersey. Norfolk's rail terminal and yard surrounds Intermodal's property, thereby requiring Intermodal and its tenants to obtain access to the property by means of an easement across Norfolk's land. The easement was created under a deed dated May 29, 1969, in which Norfolk's predecessor in interest transferred title to the property to Intermodal's predecessor in interest. The parties agree that the deed provides for a twenty-foot wide easement.

In 1984, William Stefan (Stefan), Intermodal's owner, purchased the property, which at the time contained a warehouse and was being used as a distribution facility. Stefan claimed that the access road was more than forty-feet wide at its narrowest width and wider as it approached New County Road. Stefan understood that the access road was to be shared with Norfolk.

From 1984 to 2005, Stefan's former partner occupied the property. It appears that, during that time, no one raised any concerns regarding the road. The property was then leased to Meridian IQ Services, Inc. On October 31, 2005, Norfolk filed a petition with the New Jersey Department of Transportation (NJDOT), seeking authorization to commence formal proceedings to acquire Intermodal's property through the exercise of the power of eminent domain.*fn1

In 2006, the New Jersey Turnpike Authority (NJTA) redesigned New County Road as an overpass. Consequently, the access road across Norfolk's property had to be reconfigured to go under the overpass, with ingress and egress on Seaview Drive.

In October 2006, Malcolm Roop (Roop), the senior regional manager of Norfolk's real estate department, informed the NJTA that Norfolk would be amenable to negotiating a twenty-foot wide easement to enable Intermodal to continue to have access to its property. Roop informed the NJTA that it would need "to revise the plans" and widen the road.

In early 2007, Stefan initiated discussions with Roop because he was concerned about what he viewed as "a restricting situation relative to the safety of the access road." Stefan said that he was particularly bothered by the "width and configuration" of the road, which he thought was unsafe for trucks traveling in opposite directions.

In February 2007, John M. Keller (Keller) of the NJTA wrote to Stefan and stated that the NJTA initially intended for the access road to be thirty-feet wide. Keller stated, however, that after completing the initial design, the NJTA had reduced the width of the road to twenty feet.

Stefan claimed that he called Keller and confronted him regarding why the width of the road had been reduced. According to Stefan, Keller said that Norfolk had directed the NJTA to do so and threatened to sue the NJTA if the road was wider than twenty feet. However, in his deposition, Stefan admitted that he had no personal knowledge as to the role Norfolk played in the design or construction of the new road, or if it was involved at all in the process.

In March 2007, Stefan and his son met with Roop and another representative from Norfolk to discuss sale of the property. Stefan said that Roop was pressing them to sell the property to Norfolk. Stefan expressed concern about the safety of the access road. He requested that Norfolk "look into it and see whether it was safe[.]" Roop did not pass along Stefan's concerns because he believed Stefan should have raised the issue with the NJTA.

In April 2007, Norfolk and the NJTA entered into a temporary right of entry agreement, which provided for a replacement easement grant to Intermodal and permitted the NJTA to enter upon Norfolk's property to construct the new access road. In September 2007, Stefan wrote to Roop and again voiced his concerns regarding the design and construction of the road.

At the time, Intermodal's property was located in the Intermodal B zone, which "is designed to accommodate high-intensity transportation facilities that are located proximate to rail lines," such as intermodal facilities, heavy industry and truck terminals. Intermodal applied to the New Jersey Meadowlands Commission (NJMC) to rezone the property and place it in the Transportation Center zone, which "is designed to accommodate a major commuter transfer center and associated office, hotel, and other commercial uses[,]" including bus garages, commercial off-street parking, and parks.

In April 2008, Intermodal leased its property to E-Z Cargo, Inc. (E-Z Cargo). Among other things, Intermodal's lease with EZ Cargo provided that if the NJMC rezoned the property, and it obtained permission to proceed with the development of a public parking garage, Intermodal could cancel the lease. On April 23, 2008, the NJMC granted Intermodal's application and rezoned the property, placing it in the Transportation Center zone. Norfolk appealed to this court, challenging the NJMC's action.

In mid-2008, Keller contacted Stefan and said that the NJTA was reluctant to get involved in a lawsuit concerning the access road. Stefan told Keller that he believed Norfolk had installed guardrails along the access road "to be mean spirited." He said that this had caused "a very dangerous situation." Keller suggested that removal of the guardrails might mitigate the situation, particularly due to the relatively light traffic to and from the property, but Stefan was concerned about an anticipated increased in E-Z Cargo's business and the needs of future tenants.

On July 10, 2008, Intermodal filed a complaint in the Chancery Division, in which it alleged that Norfolk had interfered with the easement across Norfolk's property. Intermodal claimed that Norfolk had reconfigured the road rendering it too narrow and unsafe for use by Intermodal's tenant and contrary to the requirements applicable in the Intermodal B zone.

The court entered an order on July 17, 2008, requiring Norfolk to show cause why a preliminary injunction should not be issued requiring it to remove the guardrails and curbing along the access road and widen the road to not less than thirty feet, and to enjoin Norfolk from impeding access to the road.

The court denied Intermodal's application for immediate removal of the guardrails and curbing and widening of the road. However, Norfolk voluntarily agreed to remove the guardrail on the right side of a turn in the road by July 19, 2008. Norfolk removed that portion of the guardrail on July 18, 2008. This increased the width of the roadway in that area to thirty-four feet, although the other guardrails remained in place.

Intermodal claims that the minimum safe width of the road is forty-one feet, and the remaining guardrails terminated abruptly in the middle of the road. On September 22, 2008, Norfolk's attorney advised the court that Norfolk had voluntarily removed all of the guardrails previously placed on the "subject driveway." Intermodal then withdrew its application for a preliminary injunction.

On October 18, 2008, following abbreviated discovery, Norfolk moved for summary judgment. The trial court considered the motion on February 2, 2009, and concluded that there were material issues of fact as to whether Norfolk had unreasonably interfered with Intermodal's easement. The court concluded, however, that Norfolk was entitled to summary judgment because there was no basis to grant Intermodal the equitable relief it was seeking.

Because Norfolk's appeal from the NJMC's rezoning decision had not been resolved, the trial court stayed further proceedings in the case pending the outcome of the appeal. In an unpublished opinion filed on July 6, 2009, we affirmed the NJMC's decision to rezone the property. In re N.J. Meadowlands Comm'n Resolution No. 08-30, No. A-4697-07T2 (App. Div. July 6, 2009) (slip op. at 2), certif. denied, 200 N.J. 475 (2009).

On January 21, 2010, the trial court decided to dismiss Intermodal's complaint with prejudice for the reasons stated in the decision placed on the record on February 2, 2009. The court issued an order dated February 3, 2010, memorializing its decision. This appeal followed.

Intermodal argues that the trial court erred by dismissing its complaint. Intermodal contends that it presented sufficient evidence to support its claim for interference with the easement and the trial court erroneously determined that the zoning changes precluded it from obtaining equitable relief on its claim.

We have carefully considered these contentions in light of the record and the applicable legal principles. We are convinced that Intermodal's arguments are without sufficient merit to warrant extended discussion in a written opinion. R. 2:11-3(e)(1)(E). However, we add the following brief comments.

"[A] judge sitting in a court of equity has a broad range of discretion to fashion the appropriate remedy in order to vindicate a wrong consistent with principles of fairness, justice, and the law." Graziano v. Grant, 326 N.J. Super. 328, 342 (App. Div. 1999). When a matter involves the application of equitable principles, a reviewing court "should not substitute its judgment for that of the trial [court]," in the absence of an abuse of discretion. Kurzke v. Nissan Motor Corp. in U.S.A., 164 N.J. 159, 165 (2000).

Here, the trial court found that Norfolk was entitled to judgment because Intermodal had not shown a basis for equitable relief. In its decision from the bench on February 2, 2009, the trial court stated that Intermodal had, by its own volition, obtained a zoning designation for its property rendering the current use nonconforming. There is no showing that the roadway as it now exists is inadequate to support the permitted uses under the new zoning classification. Were the court to require [Norfolk] to expand the easement and [Intermodal] were to subsequently construct the proposed parking garage on its property, [Norfolk] would have needlessly expended time and money constructing an unnecessarily wide roadway.

Equity would abhor bestowing such a windfall.

In our view, the trial court's decision is not an abuse of its discretion. Here, Intermodal was seeking an order requiring Norfolk to expend time and money widening an access road to Intermodal's property for its use as a distribution facility. However, Intermodal sought and was granted a zoning change to enable it to construct a parking garage for commuters on the property. The trial court correctly determined that, under these circumstances, it would be inequitable to require Norfolk to spend time and money widening the access road.

Moreover, as we have explained, Norfolk has requested authorization from the NJDOT to commence formal condemnation proceedings to acquire the Intermodal property. We have remanded that matter to the OAL for further proceedings. Should Norfolk ultimately obtain authorization to condemn Intermodal's property, widening the access road would entail a needless expenditure of time and money.


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