No Constitutional Right to Encroach on State Property

State v. Cherry Hilll Mitsubishi, Inc., 439 N.J. Super. 462 (App. Div. 2015).  The State brought a summary action against the defendant car dealers, alleging that those dealers had been encroaching on a portion of a state highway right of way.  Defendants counterclaimed for money damages and injunctive relief.  Their damage theories were that the State had violated the Civil Rights Act, 42 U.S.C. §1983, and that the State had been unjustly enriched because the dealerships had maintained the area on which they encroached.  The State moved to dismiss the counterclaim for failure to state a claim, relying on qualified immunity.  The Law Division denied that motion.  The Appellate Division granted the State’s motion for leave to appeal, and today issued a decision by Judge Alvarez that reversed the ruling below and dismissed the counterclaim.

Judge Alvarez noted that the standard of review on a motion to dismiss for failure to state a claim is plenary, and that such a motion will fail “if there is any cause of action suggested by the facts.”  But “[d]ismissal is the appropriate remedy where the pleading does not establish a colorable claim and discovery would not develop one.”  That was so here.

The Civil Rights Act counterclaim was based on the idea that defendants had “a property interest in [their] ability to encroach upon the government’s fee simple ownership of a right-of-way,” and that their equal protection rights were being violated because other businesses who were similarly encroaching on the right-of-way were not the subject of legal action.  Judge Alvarez stated that defendants had not provided “any support for the proposition that [they have] a vested, protected, or even legally cognizable property interest in continuing to encroach on State lands.”  As a result, the State correctly asserted qualified immunity from suit, since defeating that immunity requires a showing that a clearly established constitutional right is being violated.  There was no constitutional right here, let alone a “clearly established” one.  And even if defendants could have shown that the State was mistaken in its as to the boundaries of its right of way, such a mistake would not deprive the State of qualified immunity, a principle for which Judge Alvarez cited Supreme Court of the United States caselaw.  The decision contains a useful discussion of a number of the fundamental principles of qualified immunity.

The unjust enrichment claim failed for a different reason.  “[T]he only basis for such relief is a contract implied in law.”  But contracts implied in law are protected by sovereign immunity, and the Contractual Liability Act, N.J.S.A. 59:13-3, waives sovereign immunity only as to “express contracts” and “contracts implied in fact,” while expressly preserving sovereign immunity for “contracts implied in law.”

Finally, if the State proved unable to demonstrate an encroachment by defendants, they would be free to continue using the property without further legal action by the State.  Accordingly, there was no basis for an injunctive relief counterclaim and it too was dismissed.

 

 

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