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Carolyn Bethea, et al v. Israel Roizman

September 27, 2012

CAROLYN BETHEA, ET AL., PLAINTIFFS,
v.
ISRAEL ROIZMAN, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Hon. Jerome B. Simandle

OPINION

SIMANDLE, Chief Judge:

I. INTRODUCTION

This matter is before the Court on two motions for judgment on the pleadings or in the alternative, for summary judgment, and one motion for summary judgment. The first motion was filed by Plaintiffs Carolyn Bethea, Gloria D. Abner, Iona Evans, Darcell Gilmore, Margaret David, Shawn Smalls, Twanda Smith, Shelly McCullough, Georgetta Brown, Wanda Matis, Christina O'Casio, Maria Torres, Jaharia Figuero, Yvette Hernandez, Gladys Antelo ("Plaintiffs") against all Defendants. [Docket Item 123.] The City of Camden and Edward Williams ("City Defendants") filed a cross motion for judgment on the pleadings or alternatively, summary judgment in response. [Docket Item 166.] Defendants Kathy Hvasta, Camden Townhouse Associates, II, L.P., Israel Roizman, Roizman Development, Inc., William L. Cooney, S.H.N.I.R. Apartment Management Corp. and Melissa Jackson-Deeble ("Roizman Defendants") filed a cross motion for summary judgment against the Plaintiffs. [Docket Item 180.] The Plaintiffs did not file opposition to either cross motion.

In its Opinion and Order of June 27, 2012, the court granted several motions to dismiss filed by the other government agency defendants primarily on grounds of immunity, failure to comply with state notice requirements under the New Jersey Tort Claims Act and failure to state a claim. [Docket Items 172 and 173.] This reasoning applies with equal force to the City Defendants, and as discussed further below, the City Defendants' motion for judgment on the pleadings will be granted and Plaintiffs' claims against them will be dismissed.

As to the Roizman Defendants, the court will grant their motion for summary judgment. As discussed in the court's previous opinion, the Plaintiffs' complaint fails to state a claim against any of the defendants for violations of federal constitutional and civil rights. Consequently, these claims will be dismissed. In addition, there are no genuine issues of material fact in the record before the court and the court concludes as a matter of law that the Plaintiffs did not have a contractual right to ownership of their rental units. Accordingly, summary judgment is appropriate to dismiss the remainder of Plaintiffs' Second Amended Complaint.

II. BACKGROUND

The factual and procedural history of this case is set forth in the court's opinion of June 27, 2012 and is incorporated herein. [Docket Item 172]; Bethea v. Roizman, Civ. No. 11-254, 2012 WL 2500592 (D.N.J. June 27, 2012).

The Plaintiffs filed their initial complaint on January 18, 2011. [Docket Item 1.] The Plaintiffs have since amended their complaint twice.

The Second Amended Complaint is brought by 16 named Plaintiffs who are low-income African American and Hispanic women who allege that they are present and/or former tenants at Camden Townhouses II Broadway Street. (Sec. Am. Compl. ¶¶ 15-30.)

In November 1992, the Camden Redevelopment Agency ("CRA") sold 65 tracts of land and improvements to one of Roizman's businesses - Camden Townhouses Associates II, L.P. - for one hundred seventy-five thousand dollars ($175,000), and an additional forty thousand dollars ($40,000) administrative fee. (Sec. Am. Compl. ¶ 62.) Camden Townhouses Associates II also entered into an agreement that these 65 tracts of land were to be developed into 91 affordable rental housing units. (Sec. Am. Compl. ¶ 63.)

Contemporaneously, Roizman, through Camden Townhouses Associates II, L.P., acquired a loan from the New Jersey Housing Mortgage and Financing Agency ("NJHMFA") and entered into a Financing, Deed Restriction and Regulatory Agreement with the NJHMFA which stated:

It is understood by the parties hereto that after a term of fifteen (15) years from the end of the Construction Period it is the Owner's intent to sell the Project rental units to Low-Income Persons. In the event of such a sale, the Owner Hereby represents, warrants and covenants that the Project rental units will be initially offered for sale for the sum of One Dollar (U.S. $1.00) to the existing Low-Income Tenants who meet the income requirements of Low-Income Persons. (Sec. Am. Compl. ¶ 74.) On July 15, 1994, NJHMFA and Camden Townhouses Associates II, L.P. recorded a Deed of Easement and Restrictive Covenant for Extended Low-Income Occupancy which provided:

This Deed of Easement and Restrictive Covenant shall constitute an agreement between HMFA and the Owner and is enforceable in the courts of the State of New Jersey by HMFA or by an individual or individuals whether prospective, present or former occupants of the Building, who meet the low-income eligibility standards applicable in the Building under Section 42(g) of the Tax Code, said individual(s) being beneficiaries of the agreement which is expressed herein between the HMFA and the Owner. (Sec. Am. Compl. ¶ 75.)

Both agreements were recorded. (Sec. Am. Compl. ¶¶ 74, 75.) The units at the Camden Townhouses Broadway II development were then occupied by the Plaintiffs who are low-income, African American and Hispanic females. The Plaintiffs received Section 8 Housing Vouchers pursuant to 42 U.S.C. § 1437f(o) which provided the Plaintiffs with rental assistance while living at the Camden Townhouses Broadway II development. These housing vouchers were administered through the New Jersey Department of Community Affairs ("DCA"). (Sec. Am. Compl. ¶ 48.)

As a matter of legal argument, the Plaintiffs contend that as soon as they became tenants at the Camden Townhouses II Broadway Street Housing Development, "they became either direct parties to the contract or third-party beneficiaries to the contract between Roizman, Roizman Developments, Inc. and its affiliated companies and NJHMFA." (Sec. Am. Compl. ¶¶ 105-107; 123-126.)

The Plaintiffs subsequently had issues with receiving their Section 8 Housing Vouchers and were told that they no longer met the Section 8 guidelines for occupancy at Camden Townhouses II Broadway. The Plaintiffs allege they were "unlawfully steered" by the DCA Defendants and Roizman Defendants to other, less desirable rental units. (Sec. Am. Compl. ¶¶ 116, 118, 120-121, 170, 173, 179-184.) Plaintiff Bethea who remained as a resident in the Camden Townhouses II Broadway development tendered $1 to the Roizman Defendants but was never given title to her housing unit. (Sec. Am. Compl. ¶¶ 123m 126, 238.) Plaintiff Bethea was later evicted for failure to pay rent. (Sec. Am. Compl. ¶¶ 127-143).

The Plaintiffs ultimately brought the instant action and the following defendants are named in the Second Amended Complaint:

! Israel Roizman ("Roizman Defendants")

- Kathy Hvasta, Manager, Camden Townhouses Associates, II, L.P.

- William L. Coney, Manager Camden Townhouses Associates, II, L.P.

" Roizman Development, Inc.

" Camden Townhouses Associates II, L.P.

" S.H.N.I.R. Apartment Management Corp.

- Melissa Jackson-Deeble, Tenants Accounts Assistant Coordinator, S.H.N.I.R. Apartment Management Corp.

("DCA Defendants")

" Charles A. Richman, Acting Commissioner " Lori Grifa, Former Commissioner " Susan Bass-Levin, Former Commissioner " Joseph V. Doria, Jr., Former Commissioner " Annetta McCormick, Field Office Supervisor " Daniel Esochanghi, Employee " Kia Turner, Employee ! State of New Jersey Housing and Mortgage Finance

Agency ("NJHMFA") ! City of Camden

Planning ! Camden Redevelopment Agency ("CRA Defendants")

! State of New Jersey Department of Community Affairs

" Edward Williams, Director of Development and

" Olivette Simpson, Director of Housing ! United States Department of Housing and Urban

Development ("Federal Defendants")

" Balu Thumar, Acting Director of Public Housing

The Plaintiffs allege that as a result of the denial of their alleged right to purchase their low-income housing units for one dollar ($1), the named defendants violated a multitude of Plaintiffs' federal civil and constitutional rights and committed a number of state law violations against them.

The Second Amended Complaint brings the following causes of action:

Count I: Tortious Interference with Contract against All Defendants; and Count II: Breach of Contract against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., the DCA and the NJHMFA ; and

Count III: Unjust Enrichment against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., the DCA, NJHMFA and City of Camden; and Count IV: Fraudulent and Deceptive Trade Practices against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., the DCA, NJHMFA and City of Camden; and Count V: Specific Performance as to Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., and NJHMFA; and Count VI: Negligence against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., and S.H.N.I.R.; and Count VII: Violation of N.J.S.A. 54:4-6.1, et seq. against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., and S.H.N.I.R.; and Count VIII: Intentional Infliction of Emotional Distress against All Defendants; and Count IX: Unfair Debt Collection Practices against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., S.H.N.I.R., Hvasta, Coney, and Jackson-Deeble; and Count X: Fraud and Deceptive Business Practices against Roizman, Roizman Development, Inc., Camden Townhouses Associates II, L.P., S.H.N.I.R., Hvasta, Coney, Jackson-Deeble, McCormick, Esochanghi and NJDCA; and Count XI: Violations of constitutional amendments, civil rights and other federal laws against All Defendants; and Count XII: Conspiracy under the color of state law to violate Plaintiffs' constitutional rights, civil rights and other rights against All Defendants; and finally Count XIII: Bivens claim against Thumar and Jane and John Does. [Docket Item 73.] The Roizman Defendants and the City Defendants filed answers to the Second Amended Complaint. [Docket Items 94 and 97.] The DCA Defendants, NJHMFA, CRA Defendants, Federal Defendants and Defendants Olivette Simpson and Susan Bass-Levin filed motions to dismiss the claims against them in the Second Amended Complaint in their entirety.

On June 27, 2012, the court issued an opinion granting all the motions to dismiss. The court concluded that many of these governmental defendants were entitled to sovereign immunity and qualified immunity. The court found the Plaintiffs failed to state viable tort and contract claims against these government defendants because the Plaintiffs did not allege that they had filed the proper notice of claim as required under the New Jersey Tort Claims Act, N.J.S.A. 59:1-1 et seq., and the New Jersey Contractual Liability Act, N.J.S.A. 59:13-5. The court also determined that Plaintiffs' federal claims in Counts X and XI did not meet the pleading requirements of Rule 8. Specifically, the court was unable to make sense of the Plaintiff's conclusory allegations which were so broad as to encompass the entire universe of federal and state law. Since the Plaintiffs' allegations were merely "labels and conclusions" without any factual specificity, the court dismissed Counts XI and XII against all the moving defendants. [Docket Item 172.]

While the motions to dismiss were pending, the court stayed Plaintiffs' pending motion for judgment on the pleadings or in the alternative, summary judgment [Docket Item 123] and the City Defendants' cross motion [Docket Item 166.] The court dismissed as moot Plaintiffs' motion for judgment on the pleadings as to the DCA Defendants, NJHMFA, CRA Defendants, Federal Defendants and Defendants Olivette Simpson and Susan Bass-Levin in the court's June 27, 2012 order granting these defendants' motions to dismiss. [Docket Item 73.] The court also lifted the stay on the City Defendants' motion and the Plaintiffs' motion as it pertained to the City Defendants and the Roizman Defendants. Id.

In response to the Plaintiff's motion, the Roizman Defendants filed their own cross motion for summary judgment. [Docket Item 180.] The Plaintiff has not filed a response to the City Defendant's cross motion or the Roizman Defendant's cross motion, and the time to do so has expired.

III. Standard of Review

Judgment on the pleadings pursuant to Rule 12(c), "will only be granted where the moving party clearly establishes there are no material issues of fact, and that he or she is entitled to judgment as a matter of law." DiCarlo v. St. Mary Hosp., 530 F.3d 255, 259 (3d Cir. 2008). Where the movant alleges that the complaint fails to state a claim upon which relief can be granted, the court applies the same standards as under Rule 12(b)(6). Turbe v. Government of Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991); Spruill v. Gillis, 372 F.3d 218, 223 n.2 (3d Cir. 2004) (applying Rule 12(b)(6) standard to Rule 12(c) motion).

In order to give defendant fair notice, and to permit early dismissal if the complained-of conduct does not provide adequate grounds for the cause of action alleged, a complaint must allege, in more than legal boilerplate, those facts about the conduct of each defendant giving rise to liability. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007); Fed. R. Civ. P. 8(a) and 11(b)(3). These factual allegations must present a plausible basis for relief (i.e., something more than the mere possibility of legal misconduct). See Ashcroft v. Iqbal, 556 U.S. 662, 681 (2009). In its review of a motion to dismiss pursuant to Rule 12(b)(6), Fed. R. Civ. P., the Court must "accept all factual allegations as true and construe the complaint in the light most favorable to the plaintiff." Phillips v. County of Allegheny, 515 F.3d 224, 231 (3d Cir. 2008) (quoting Pinker v. Roche Holdings Ltd., 292 F.3d 361, 374 n.7 (3d Cir. 2002)).

The assumption of truth does not apply, however, to legal conclusions couched as factual allegations or to "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements." Iqbal, 556 U.S. at 678.

In ruling on a Rule 12(b)(6) motion to dismiss, a district court may not consider matters extraneous to the pleading sought to be dismissed. In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997). Fed. R. Civ. P. 12(d) provides that:

If, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56. All parties must be given a reasonable opportunity to present all the material that is pertinent to the motion.

As a general rule, a district court considering a 12(b)(6) motion to dismiss relies on "the complaint, attached exhibits, and matters of public record." Sands v. McCormick, 502 F.3d 263, 268 (3d Cir. 2007); see also In re Burlington Coat Factory, 114 F.3d at 1425 (deciding that the district court, in ruling on a motion to dismiss, should not have considered information from the brief supporting the motion to dismiss).

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Where the nonmoving party bears the burden of persuasion at trial, the moving party may be entitled to summary judgment merely by showing that there is an absence of evidence to support an essential element of the nonmoving party's case. Fed. R. Civ. P. 56(c)(1)(B); Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).

The summary judgment standard does not change when the parties have filed cross-motions for summary judgment. See Appelmans v. City of Phila., 826 F.2d 214, 216 (3d Cir. 1987). Cross-motions for summary judgment: are no more than a claim by each side that it alone is entitled to summary judgment, and the making of such inherently contradictory claims does not constitute an agreement that if one is rejected the other is necessarily justified or that the losing party waives judicial consideration and determination whether genuine issues of material fact exist.

Transportes Ferreos de Venezuela II CA v. NKK Corp., 239 F.3d 555, 560 (3d Cir. 2001) (citing Rains v. Cascade Indus., Inc., 402 F.2d 241, 245 (3d Cir. 1968)). If review of cross-motions for summary judgment reveals no genuine issue of material fact, then judgment may be entered in favor of the party deserving of judgment in light of the law and undisputed facts. See Iberia Foods Corp. v. Romeo Jr., 150 F.3d 298, 302 (3d Cir. 1998) (citing Ciarlante v. Brown & Williamson Tobacco Corp., 143 F.3d 139, 145--46 (3d Cir. 1988)).

IV. City Defendants' Cross Motion for Judgment on the Pleadings or in the alternative, Summary Judgment

The Camden Townhouses Broadway II Development is located in Defendant City of Camden. As alleged in the Second Amended Complaint, Defendant Edward Williams is the Director of Development and Planning for Defendant City of Camden. (Sec. Am. Compl. ¶ 56.) In order to finance the Camden Townhouses II Broadway Development, on November 5, 1992, the Roizman Defendants acquired a subordinate mortgage loan in the amount of $1,000,000.00 from Defendant City of Camden and the DCA. (Sec. Am. Compl. ¶ 66.) The Plaintiffs allege the City Defendants failed to properly supervise the Roizman Defendants and consequently allowed them to discriminate in the provision of low-income housing. (Sec. Am. Compl. ¶ 69.) The Plaintiffs further allege that the Roizman Defendants repaid this mortgage by using proceeds from Section 8 Rental subsidies. (Sec. Am. Compl. ¶ 76.)

In 2004, the City Defendants and the CRA were in the process of revising the City's Master Plans and designated the area where the Camden Townhouses Broadway II Development was located as a prime redevelopment area. (Sec. Am. Compl. ¶ 99.) The Second Amended Complaint alleges that City Defendants never notified the Plaintiffs, as tenants in the Townhouse Development, of the consequences of this redevelopment plan, known as the Cooper Plaza Redevelopment Plan. (Sec. Am. Compl. ¶ 100.) The Plaintiffs also allege that the Cooper Redevelopment plan was designed to exclude Plaintiffs from the area and violated Plaintiffs' constitutional and civil rights. (Sec. Am. Compl. ¶ 103.) This exclusionary result was allegedly part of a custom, policy or practice of the City Defendants. (Sec. Am. Compl. ¶ 104.) The Second Amended Complaint further alleges that the City of Camden was the recipient of "hundreds of millions of dollars in federal funds, tax credits and other monetary benefits which were used to fund" the Camden Townhouses Broadway II development. (Sec. Am. Compl. ¶ 59.)

The Second Amended Complaint brings the following causes of action against the City Defendants: tortious interference with contract (Count I); unjust enrichment (Count III); fraudulent and deceptive trade practices (Count IV); intentional infliction of emotional distress (Count VIII); violations of constitutional amendments, civil rights and other federal laws (Count XI); and conspiracy under the color of state law to violate Plaintiffs' constitutional rights, civil rights and other rights (Count XII).

A. Parties' Arguments

The Plaintiffs' move for judgment on the pleadings and summary judgment on Plaintiffs' claims for tortious interference (Count I), breach of contract (Count II), unjust enrichment (Count III), violations of constitutional amendments, civil rights and other federal laws (Count XI)*fn1 and conspiracy to violate constitutional, civil and other rights (Count XII). The Plaintiffs' motion for judgment on the pleadings or in the alternative, summary judgment, makes several generalized arguments against all defendants and does not specifically address its claims against the City Defendants. [Docket Item 123.] The Plaintiffs' arguments are repetitive of their opposition to the prior motions to dismiss. [Docket Item 113.] In general, the Plaintiffs argue that the City Defendants are not entitled to immunity, the Plaintiffs did not have to comply with the notice requirements of the New Jersey Tort Claims Act and the Plaintiffs have conclusively established all the necessary facts to support their claims. The Plaintiffs rely primarily on their allegations in the Second Amended Complaint.*fn2

The City Defendants make several arguments in support of their cross motion. In particular, the City Defendants contend that the Plaintiffs have not alleged compliance with the notice requirements of the New Jersey Tort Claims Act and therefore, all tort claims against the City Defendants should be dismissed. The City Defendants also argue that the Plaintiffs fail to state a claim for unjust enrichment because they have not alleged facts to support that the City Defendants received or retained any benefit from the Plaintiffs. As to the federal claims, the City Defendants argue that Defendant Williams is entitled to qualified immunity and the Plaintiffs have failed to sufficiently plead discrimination or any constitutional or civil rights violations.

B. Analysis

1. Tort Claims

It is clear and the parties do not dispute that the City of Camden is a public entity and Edward Williams, as the Director of the City of Camden's Department of Planning and Development, is a public employee as defined by the New Jersey Tort Claims Act. Tort claims against public entities and public employees are governed by the New Jersey Tort Claims Act ("NJTCA"), N.J.S.A. 59:1-1 et seq. See Velez v. City of Jersey City, 180 N.J. 284 (2004). The NJTCA requires that a notice of claim be filed with the public entity not later than the ninetieth (90th) day after accrual of the underlying cause of action. N.J.S.A. 59:8-8(a).

Failure to file the required notice will result in the dismissal of a plaintiff's tort claims. N.J. Stat. Ann. 59:8-3.

The NJTCA defines public entity broadly and "includes the State, and any county, municipality, district, public authority, public agency, and any other political subdivision or public body in the State." N.J.S.A. 59:1-3. Accoridngly, the City of Camden, as a municipality, is a public entity as defined by the NJTCA and Edward Williams, as the Director of the City of Camden Department of Planning and Development, is a public employee.

Accordingly, the notice provisions of the NJTCA apply and failure to comply with these notice provisions requires dismissal. In this case, the Second Amended Complaint does not allege compliance with the NJTCA notice requirements. Consequently, the Plaintiffs have failed to state a claim against the City Defendants for tortious interference with contract, fraudulent and deceptive trade practices or intentional infliction of emotional distress.

Therefore, the City Defendants' motion for judgment on the pleadings will be granted as to Counts I, IV and VIII of the Plaintiffs' complaint.

2. Unjust Enrichment

Under New Jersey law, there are two basic elements of unjust enrichment. "A plaintiff must demonstrate both that defendant received a benefit and that retention of that benefit without payment would be unjust." MK Strategies, LLC v. Ann Taylor Stores Corp., 567 F. Supp. 2d 729, 733 (D.N.J. 2008).

In this case, the Plaintiffs have failed to allege that they conferred a benefit on the City Defendants. The City Defendants did not own or control the Camden Townhouses Broadway II Development. Any Section 8 housing vouchers or tax credits that the City allegedly received did not come from the Plaintiffs. There are no allegations that the Plaintiffs paid their rent directly to the City; rather, the Plaintiffs allege they paid their rent to the Roizman Defendants. (Sec. Am. Compl. ¶¶ 97, 111, 137

The Plaintiffs have failed to allege that they conferred a benefit on the City Defendants. Without alleging a plausible factual basis for this element, the Plaintiffs' claims for unjust enrichment against the City Defendants must be dismissed. Therefore, the City Defendants' motion for judgment on the pleadings as to Count III will be granted.

3. Federal Claims

As discussed in this court's previous opinion on June 27, 2012, the Plaintiffs' complaint fails to meet the pleading requirements of Rule 8 with regard to Counts XI and XII which allege violations of constitutional amendments, civil rights and other federal laws as well as ...


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