Opinion
DOCKET NO. A-0256-13T1
10-21-2014
BEZR HOMES, L.L.C., Plaintiff-Appellant, v. TOWNSHIP OF EAST GREENWICH and JOHN DEGEORGE, Defendants, and REMINGTON & VERNICK ENGINEERS and KENNETH C. RESSLER, Defendants-Respondents.
Ware, Streitz & Thompson, attorneys for appellant (Gary D. Thompson on the briefs). Archer & Greiner, attorneys for respondents (Ellis I. Medoway and Benjamin D. Morgan on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Hayden and Leone. On appeal from Superior Court of New Jersey, Law Division, Gloucester County, Docket No. L-1908-12. Ware, Streitz & Thompson, attorneys for appellant (Gary D. Thompson on the briefs). Archer & Greiner, attorneys for respondents (Ellis I. Medoway and Benjamin D. Morgan on the brief). PER CURIAM
Plaintiff BEZR Homes, L.L.C. appeals from the grant of summary judgment in favor of defendants Remington & Vernick Engineers (Remington) and Kenneth Ressler, an engineer with Remington (collectively, the "Remington defendants"). Plaintiff argues that the trial court erroneously ruled that Ressler and Remington were public employees under the Tort Claims Act (TCA), N.J.S.A. 59:1-1 to 59:12-3. We affirm.
I.
By resolution adopted January 4, 2004, defendant the Township of East Greenwich appointed Ressler as its municipal engineer "to perform such duties as are requested by the Township Committee on behalf of the Township." This "professional services" contract would last through December 31, 2006. By resolution adopted January 6, 2007, signed by defendant John DeGeorge as mayor, the Township appointed Remington as its municipal engineer in a "professional services" contract lasting for three years.
Plaintiff's complaint alleged as follows. Plaintiff owned property in the Township, and obtained approvals for a development to be known as Kings Gate West consisting of seventy-seven single-family homes. On January 29, 2004, plaintiff received through the Township a permit from the Department of Environmental Protection (DEP) for construction of a water main to provide water services to the proposed development. The permit was valid for three years.
According to plaintiff's complaint, on January 16, 2007, plaintiff requested the Township file for an extension of the permit. Defendants filed the request in an untimely manner, despite knowing it would be denied and that plaintiff had entered into a contract to sell the property. Consequently, a new permit application had to be submitted, but defendants again failed to apply in a timely manner and to submit an application fee. The DEP deemed the application incomplete. As a result, the prospective purchaser terminated the contract for sale, depriving plaintiff of the $7,500,000 sales price.
On October 16, 2007, plaintiff filed a TCA notice of claim addressed to the Township. However, plaintiff did not file a complaint against defendants until December 28, 2012. Because the complaint was not filed within the TCA's two-year limitations period, N.J.S.A. 59:8-8, the Township and DeGeorge obtained dismissal of the complaint against them.
The Remington defendants similarly moved for summary judgment. After hearing argument, the trial court granted summary judgment and dismissed plaintiff's complaint with prejudice in an oral opinion and order on August 2, 2013. Plaintiff appeals.
II.
Summary judgment must be granted if "there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c). Deciding "whether there exists a 'genuine issue' of material fact that precludes summary judgment requires the [court] to consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).
A party opposing a motion for summary judgment must "set[] forth specific facts showing that there is a genuine issue for trial," or "that the party was unable to present . . . facts essential to justify opposition" because discovery was incomplete. R. 4:46-5(a). If a "'suit is in an early stage and still not fully developed,'" the court should consider "'whether there is any basis upon which plaintiff should be entitled to proceed further.'" Velantzas v. Colgate-Palmolive Co., 109 N.J. 189, 193 (1988). "When 'critical facts are peculiarly within the moving party's knowledge,' it is especially inappropriate to grant summary judgment when discovery is incomplete." Ibid. However, the opposing party must "demonstrate with some specificity the discovery sought, and its materiality." In re Ocean County Comm'r of Registration for a Recheck of the Voting Machines, 379 N.J. Super. 461, 479 (App. Div. 2005). Summary judgment is appropriate if further discovery will "not change the outcome." Minoia v. Kushner, 365 N.J. Super. 304, 307 (App. Div.), certif. denied, 180 N.J. 354 (2004).
As "appellate courts 'employ the same standard that governs the trial court,'" we review these determinations de novo, and the "trial court rulings 'are not entitled to any special deference.'" Henry v. N.J. Dept. of Human Servs., 204 N.J. 320, 330 (2010). We must hew to that standard of review.
III.
"[I]n every municipality the governing body, by ordinance, shall provide for the appointment of a municipal engineer" for a term of three years. N.J.S.A. 40A:9-140. The Township's ordinance requires the township engineer be "a duly licensed professional engineer." Twp. Of East Greenwich Ordinance § 2.20.010. The Township's resolutions appointed first Ressler and then Remington itself to the position of municipal engineer. See Borough of Dunellen v. F. Montecalvo Contractor Co., 273 N.J. Super. 23, 30 (App. Div. 1994) (a corporation may be appointed as the municipal engineer under N.J.S.A. 40A:9-140).
The Remington defendants contend they were public employees under the TCA, which requires actions to be filed within two years. Plaintiff argues the Remington defendants were independent contractors, to which the TCA and its time limits do not apply.
The TCA "'establishes the procedures by which claims may be brought'" against public entities and public employees. D.D. v. Univ. of Med. and Dentistry of N.J., 213 N.J. 130, 146 (2013). The TCA defines a public employee as "an employee of a public entity," such as a municipality. N.J.S.A. 59:1-3. "'Employee' includes an officer, employee, or servant, whether or not compensated or part-time, who is authorized to perform any act or service; provided, however, that the term does not include an independent contractor." Ibid.
"Courts use two different tests to distinguish employees from independent contractors," namely the "control test" and the "relative nature of the work" test. Lowe v. Zarghami, 158 N.J. 606, 615-16 (1999). "If the court determines that a person is an employee under the control test, then the inquiry ends there. If, however, the control test is inconclusive, then the court must determine whether it is appropriate to apply the relative nature of the work test." Id. at 618 (citations omitted).
The control test looks at whether "the employer controls both the nature of the work performed and the manner in which the work is completed," which would indicate the person performing the work is an employee. Id. at 615-16. "On the other hand, an employer hires an independent contractor to complete a particular task, but does not direct the manner in which it is to be completed." Id. at 616. "[T]he control test assesses four factors in determining a worker's status: (1) the degree of control exercised by the employer over the means of completing the work; (2) the source of the worker's compensation; (3) the source of the worker's equipment and resources; and (4) the employer's termination rights." Ibid.
The Remington defendants instead contend their status should be determined not under the control test but under the relative nature of the work test. "The relative nature of the work test supplements the control test in limited circumstances." Id. at 618. In Lowe, our Supreme Court agreed that "it is appropriate generally to apply the relative nature of the work test in situations involving work performed by professional employees." Id. at 618 (citing Dunellen, supra, 273 N.J. Super. at 28). "[I]f the working relationship involves professional services where an employer cannot exercise control over the methods used to provide those services, the relative nature of the work test may provide a more accurate assessment of the working relationship." Id. at 618.
Here, it is undisputed Ressler is a professional engineer, and Remington is a firm of professional engineers. The Township resolutions appointing them as the municipal engineer required they provide professional services to the Township. Moreover, Dunellen applied the relative nature of the work test to a borough engineer. Dunellen, supra, 273 N.J. Super. at 28-30. "The control test was not an appropriate gauge because 'as is the case with all professional employees, the governing body did not control the details of how [the engineer] performed . . . services.'" Lowe, supra, 158 N.J. at 617 (alteration by Court; quoting Dunellen, supra, 273 N.J. Super. at 28). Thus, the relative nature of the work test must be applied to the Remington defendants.
IV.
The relative nature of the work test recognizes that,
"where it is not in the nature of the work for the manner of its performance to be within the hiring party's direct control, the factor of control can obviously not be the critical one in the resolution of the case, but takes its place as only one of the various potential indicia of the relationship which must be balanced and weighed in determining what, under the totality of the circumstances, the character of that relationship really is.""The relative nature of the work test requires a court to examine 'the extent of the economic dependence of the worker upon the business he serves and the relationship of the nature of his work to the operation of that business.'" Ibid.
[Lowe, supra, 158 N.J. at 616 (quoting Marcus v. Eastern Agricultural Ass'n, 58 N.J. Super. 584, 597 (App. Div. 1959) (Conford, J. dissenting), rev'd on dissent, 32 N.J. 460 (1960)).]
Plaintiff argues that it was premature to apply the relative standard of the work test because discovery was still required on various topics. We will address those topics as we apply the test.
First, the relative nature of the work test "considers 'control' as a single, but not dispositive, factor." Wajner v. Newark Beth Israel Med. Ctr., 298 N.J. Super. 116, 120 (App. Div. 1997); accord Lowe, supra, 158 N.J. at 617. We will assume that, "as is the case with all professional employees, the governing body did not control the details of how [the engineer] performed . . . services." Dunellen, supra, 273 N.J. Super. at 28; see Eagan v. Boyarsky, 158 N.J. 632, 639 (1999).
We thus assume this factor indicates an independent contractor relationship. Therefore, there is no need for plaintiff's requested discovery about the elements of the control test, namely whether the Township reserved the right to control the manner and means of the Remington defendants' performance of engineering services, the source of the equipment and resources they used in performing engineering services or the extent of the Township's termination rights or discharge powers. See Lowe, supra, 158 N.J. at 616. In any case, plaintiff has not suggested "that the governing body exercised any less control over the services [the Remington defendants] performed for the project than over other engineering services [they] performed" as municipal engineer. Dunellen, supra, 273 N.J. Super. at 28.
Second, we consider "economic dependence." See Lowe, supra, 158 N.J. at 617. The part-time nature of the position affects this analysis. The Remington defendants undoubtedly receive compensation from their other clients. However, a public employee can be a person or entity working "part-time, who is authorized to perform any act or service." N.J.S.A. 59:1-3. Thus, in applying the test, we must look only to the acts and services the Remington defendants are authorized to perform for the Township. This renders irrelevant plaintiff's requested discovery of the amount of compensation the Remington defendants received from the Township in comparison with the total compensation they received from all public and private clients.
The Township's ordinance provided that the municipal engineer shall receive "such compensation as may be agreed upon and determined by the township committee." Twp. Of East Greenwich Ordinance § 2.20.010. Thus, the Remington defendants were "totally economically dependent" on the Township for payment for their acts and services as municipal engineer for the Township. See Lowe, supra, 158 N.J. at 623.
Plaintiff additionally seeks discovery of whether the Remington defendants received a salary with the usual employer deductions or withholding. However, it was conceded that the Township did not pay the municipal engineer that way. Nevertheless, that is not dispositive. By statute, the Township could "fix [the] compensation in an annual salary or fixed fee basis or at an hourly rate and based upon actual time and expenses agreed on prior to the rendering of the services." N.J.S.A. 40A:9-140. Given these statutory options for compensating the municipal engineer, discovery of which option was chosen would not alter the economic dependence of the Remington defendants on the Township.
Because of that dependence, we do not see the relevance of plaintiff's requested discovery of whether the Remington defendants issued billing statements for the services rendered on the Kings Gate West project. By law, "[n]o municipal engineer shall be compensated by receiving a percentage of the contract for which he renders services." Ibid. As we stated in Dunellen, the fact that services for a project were "billed at the hourly rate of the borough engineer" did not mean that the project "lay outside its role as a public employee," because "[t]he Legislature obviously contemplated that a borough engineer would be performing services such as those [he] performed in connection with the" project. Dunellen, supra, 273 N.J. Super. at 29-30.
Third, we must examine "the relationship of the nature of [the Remington defendants'] work to the operation of [the Township's] business." See Lowe, supra, 158 N.J. at 616. Here, the Remington defendants were hired not merely to perform services, but to fill a statutory office. Under N.J.S.A. 40A:9-140, the Township was required to appoint a municipal engineer. That alone is sufficient to show that the municipal engineer's "work constituted an integral part of [the Township's] business." See Lowe, supra, 158 N.J. at 623. Moreover, the Township's ordinance requires that the township engineer "shall perform the duties prescribed by general law and ordinance." Twp. Of East Greenwich Ordinance § 2.20.020.
We must also consider whether "the goals of the business are served by concluding that the particular worker is an employee." Lowe, supra, 158 N.J. at 622. That is the case here. If municipal engineers "are considered independent contractors, they may be personally liable for their malpractice. If personal liability becomes the rule," many professional engineers may "eschew [municipal engineer] status," which "would limit the quality of" municipal engineers. See id. at 623. If the municipalities countered by "elect[ing] to indemnify" municipal engineers, "then costs will increase" and "drain resources from" municipalities. Ibid. "Those factors weigh heavily in favor of concluding that" a municipal engineer "must be considered a public employee." Ibid.
Plaintiff asserts it needs discovery to determine the extent of the Remington defendants' economic dependence, and the relationship of the nature of their work to the operation of the Township's business. Plaintiff specifically request the agreement between the Township and the Remington defendants concerning their professional services, but plaintiff has been unable to suggest what in that document would affect the outcome. Like the trial court, we cannot think of any discovery that would change the outcome given the statutory and ordinance provisions governing municipal engineers. Because "continued discovery would not produce any additional facts necessary to a proper disposition of the motion," plaintiff has not shown that summary judgment was barred. DepoLink Court Reporting & Litig. Support Servs. v. Rochman, 430 N.J. Super. 325, 341 (App. Div. 2013).
Thus, we find that "both aspects of the relative nature of the work test are satisfied." Lowe, supra, 158 N.J. at 622. The result of that test outweighs the Township's lack of control over the details of how the Remington defendants performed their duties as municipal engineers. "As with other publicly employed professionals, control is 'inimical to the task to be performed,' since the nature of the work depends on the professionals' independent exercise of judgment." Id. at 620. Lowe held that a physician was an employee of UMDNJ even though it "exercised little control over" how he treated patients. Id. at 618. Indeed, Lowe cited with approval a decision finding that law guardians are public employees of the Office of the Public Defender even though it could not exercise any control over them. Id. at 620 (citing Delbridge v. Office of the Pub. Defender, 238 N.J. Super. 288, 322 (Law Div. 1989)).
Accordingly, we conclude that the Remington defendants were public employees under N.J.S.A. 59:1-3. Plaintiff does not claim the Remington defendants performed, or had any duty to perform, any acts or services in this matter other than as the municipal engineer for the Township. See Neelthak Dev. Corp. v. Twp. of Gloucester, 272 N.J. Super. 319, 325 (App. Div. 1994). In that situation, we agree that "under New Jersey law a municipal engineer is a public employee" by definition. Cnty. Concrete Corp. v. Twp. of Roxbury, 442 F.3d 159, 176 (3d Cir. 2006).
V.
Because Remington and Ressler were public employees, plaintiff's complaint was properly dismissed. Under the TCA, a "claimant shall be forever barred from recovering against a public entity or public employee if . . . [t]wo years have elapsed since the accrual of the claim" before the claimant files suit. N.J.S.A. 59:8-8. The TCA emphasizes that "in no event may any suit against a public entity or a public employee arising under this act be filed later than two years from the time of the accrual of the claim." N.J.S.A. 59:8-9. Plaintiff does not dispute that its complaint was filed more than two years after the accrual of its claim.
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPEALATE DIVISION