NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-6072-99T2
DOROTHEA M. MUTSCHLER,
RICHARD WILDE and
BARBARA WILDE,
Plaintiffs-Respondents,
v.
NEW JERSEY DEPARTMENT OF
ENVIRONMENTAL PROTECTION,
RAYMOND E. CANTOR and
KEVIN BRODERICK,
Defendants-Appellants,
and
BOROUGH OF WEST CAPE MAY,
Defendant-Respondent.
________________________________________
Argued October 31, 2000 - Decided January 18, 2001
Before Judges Skillman, Conley and Wecker.
On appeal from Superior Court of New Jersey,
Law Division, Cape May County, L-78-00.
Brian Weeks, Deputy Attorney General, argued
the cause for appellants (John J. Farmer,
Jr., Attorney General, attorney; Mary C.
Jacobson, Assistant Attorney General, of
counsel; Mr. Weeks, on the brief).
Richard M. Hluchan argued the cause for
respondents Dorothea M. Mutschler, Richard
Wilde and Barbara Wilde (Ballard Spahr
Andrews & Ingersoll, attorneys; Mr. Hluchan,
of counsel; Jeffrey S. Beenstock, on the
brief).
Robert L. Taylor, argued the cause for
respondent Borough of West Cape May.
The opinion of the court was delivered by
SKILLMAN, P.J.A.D.
The Coastal Area Facility Review Act (CAFRA), N.J.S.A.
13:19-1 to 21, requires any party who plans to construct a
"public development" within the coastal area to obtain a permit
from the Department of Environmental Protection (DEP). N.J.S.A.
13:19-5. In 1995, the Borough of West Cape May obtained a CAFRA
permit that authorized the municipality to construct an
additional wastewater pump station and extend its sewer lines.
The permit contained various conditions that West Cape May was
required to satisfy before starting construction.
This appeal turns on the interpretation of condition seven
of the permit, which provides in relevant part:
[W]ritten authorization [must be obtained]
from the [DEP], prior to the installation of
any sewer "laterals or tie-ins" to
undeveloped properties within: a) wetlands,
b) the 150' transition (buffer) areas from
these wetlands, or c) wet soils or high
permeability moist soils (below elevation
10') as shown on the referenced "Land
Capability Map". Prior to construction, the
Borough must adopt a Land Use Regulation
Program approved municipal resolution clearly
listing all these properties.
To comply with this condition, West Cape May's governing
body adopted a resolution that listed the undeveloped properties
in the proposed new sewer service area that West Cape May
considered to be within wetlands, transition buffer areas or wet
or high permeability moist soils below ten feet in elevation.
Plaintiff Dorothea Mutschler's property in the new sewer service
area was omitted from this list.
Plaintiffs Richard and Barbara Wilde subsequently contracted
to purchase this property from Mutschler. They propose to
construct a twenty-one unit residential development on the
property. To obtain authorization for their development, the
Wildes applied to defendant Borough of West Cape May Planning
Board (Planning Board) for subdivision approval.
Shortly before the application was to be heard, defendant
Kevin Broderick, the Chief of the DEP's Land Use Regulation
Program, sent a letter to the Planning Board Chairperson, which
stated that "prior to the start of construction of any sewerage
generating development on [the property], approval must be
received from the [DEP's] Land Use Regulation Program." Based on
this letter, the Planning Board deferred consideration of the
Wildes' application pending the DEP's approval.
After further review of the matter, Broderick sent a letter
to Mr. Wilde, dated June 17, 1999, which reaffirmed that the
Wildes must obtain authorization from the DEP, in accordance with
condition seven of the sewer construction permit, before their
proposed residential development can be connected to the new
sewer line:
A review of the site plan [for the
Wilde's proposed residential development]
. . . in concert with a review of the "Soil
Survey of Cape May County", reveals
construction is proposed in either a wet or
high permeability moist soil. Accordingly,
written approval is necessary from the [DEP]
before your development can tie into the
Stevens Street sewer line.
Defendant Raymond E. Cantor, an Assistant Commissioner of
the DEP, subsequently sent a letter to the Wildes' attorney,
dated December 23, 1999, which affirmed Section Chief Broderick's
ruling:
Pursuant to [condition seven], it was
incumbent upon [West Cape May] to accurately
investigate all potentially sewerable
properties that could be serviced by the
Stevens Street line and then pass an
ordinance that restricted development from
those properties unless prior approval had
been received from the [DEP].
Subsequent to receiving the CAFRA
permit, . . . West Cape May did pass an
ordinance that restricted development from
various blocks and lots unless prior approval
was received from the [DEP]. However, [West
Cape May] apparently did not analyze each
property on an individual basis, instead
relying on generalized maps such as the 1986
Freshwater Wetland Quarter-Quads along with
the USGS photo-quads. It does not appear
from our review of the file, that any land
analysis contained a review of the Cape May
County Soil Survey. The unfortunate result
of this omission was that [West Cape May]
. . . missed that [the Mutschler property
was] in fact not developed, contained wet
soils or high permeability moist soils,
contained either wetlands or wetlands buffers
and were below elevation 10'.
Since it was [West Cape May's]
responsibility to provide the Program with
the listing of properties that contained any
of the above criteria and [West Cape May] did
not provide an accurate picture of existing
sensitive conditions, the [DEP] is not bound
by the ordinance because it is based on
incomplete information.
Plaintiffs filed this action in the Law Division, seeking a
declaratory judgment that "no NJDEP approval is necessary
pursuant to CAFRA in order for the Mutschler property to tie into
the sewer line," as well as other relief. After defendants
answered, plaintiffs moved for a partial summary judgment
declaring that "NJDEP approval is not required for development on
[the Mutschler property] to connect to the sanitary sewer system"
and enjoining the DEP from "interfer[ing] with Plaintiffs'
application for subdivision approval." Defendants filed a cross-
motion to dismiss plaintiffs' complaint. One of the grounds of
defendants' motion was that the Law Division lacked jurisdiction
because this court has exclusive jurisdiction to review any
action by a state administrative agency.
The trial court declined to consider defendants' motion to
dismiss because of procedural defects. The court subsequently
issued a brief written decision which concluded that even though
West Cape May's failure to include the Mutschler property on the
list of properties that require DEP approval to connect into the
expanded sewer system "may have been an error," plaintiffs were
entitled to rely upon that omission. Accordingly, the court
entered summary judgment declaring that plaintiffs are not
required to obtain the DEP's approval to connect their proposed
residential development into the sewer system. The court also
enjoined the DEP, Cantor, and Broderick from interfering with
plaintiffs' application for subdivision approval.
We granted the DEP's motion for leave to appeal and now
reverse. We conclude that the Law Division lacked jurisdiction
to review the DEP's declaratory ruling that plaintiffs are
required by condition seven of the sewer construction permit to
obtain the DEP's authorization to connect into the West Cape May
sewer system, and that the case should have been transferred to
this court. We also conclude that the DEP's declaratory ruling
is ripe for appellate review, and therefore treat the case as if
it had been transferred to this court. We further conclude that,
pursuant to condition seven, the DEP correctly ruled that
plaintiffs must obtain its approval to connect into the West Cape
May sewer system.
I
The Appellate Division has been vested with exclusive
jurisdiction to review any action or inaction of a state
administrative agency.
Pascucci v. Vagott,
71 N.J. 40, 51-54
(1976);
Equitable Life Mortgage & Realty Investors v. New Jersey
Div. of Taxation,
151 N.J. Super. 232, 237-38 (App. Div.),
certif. denied,
75 N.J. 535 (1977). The Appellate Division's
exclusive jurisdiction does not turn on the theory of the
challenging party's claim or the nature of the relief sought.
Central R.R. Co. v. Neeld,
26 N.J. 172, 184-85,
cert. denied, 357
U.S. 928,
78 S. Ct. 1373,
2 L. Ed.2d 1371 (1958). Thus, this
court's exclusive jurisdiction extends to claims of state agency
inaction,
Hospital Ctr. at Orange v. Guhl,
331 N.J. Super. 322,
329-30 (App. Div. 2000), and to claims that are essentially
declaratory in nature.
Equitable Life Mortgage & Realty
Investors v. New Jersey Div. of Taxation,
supra, 151
N.J. Super.
at 238. It also extends to claims that are joined with claims
within the jurisdiction of another court or division of this
court.
Pascucci v. Vagott,
supra, 71
N.J. at 52-54.See footnote 11
If a challenge to the action or inaction of a state
administrative agency is brought in a trial court, that court has
the responsibility to transfer the matter to this court on the
motion of a party or "on its own initiative."
R. 1:13-4(a). If
a trial court fails to transfer a challenge to state agency
action to this court and instead decides the merits, we may
exercise our original jurisdiction on appeal from the judgment
and review the underlying agency action as if the challenging
party had appealed directly to this court.
See Degnan v.
Nordmark & Hood Presentations, Inc.,
177 N.J. Super. 186, 191
(App. Div.),
appeal dismissed,
87 N.J. 427 (1981). In that
event, we review only the agency's action, not the trial court's
determination of a matter over which it had no jurisdiction.
The DEP's action in this case consisted of an interpretation
of condition seven of the CAFRA permit that the DEP had issued to
West Cape May for an extension of its sewer system. The DEP
determined that, pursuant to this condition, plaintiffs must
obtain authorization from the DEP to connect into the system even
though West Cape May had failed to include the Mutschler property
on the list of properties subject to this requirement. This was
a declaratory ruling concerning the meaning of condition seven of
the permit that the DEP issued to West Cape May, which is a state
administrative agency action that may be reviewed only by this
court.
See Degnan v. Nordmark & Hood Presentations, Inc.,
supra,
177
N.J. Super. at 191-92;
Princeton First Aid & Rescue Squad,
Inc. v. Division on Civil Rights,
124 N.J. Super. 150, 152-53
(App. Div.),
certif. denied,
63 N.J. 555 (1973). Therefore, the
trial court erred in undertaking to review the DEP's
interpretation of condition seven of the sewer construction
permit issued to West Cape May.
Although the trial court should have transferred plaintiffs'
challenge to the DEP's interpretation of condition seven to this
court, we conclude that plaintiffs' complaint should be treated
as an appeal from the DEP's declaratory ruling, and that that
ruling is ripe for appellate review. The Deputy Attorney General
representing the DEP advised us at oral argument that Assistant
Commissioner Cantor's December 23, 1999 letter constituted the
agency's final determination concerning the meaning of condition
seven, and that the only administrative remedy now available to
plaintiffs would be to file an application with the DEP for
approval of the connection of their proposed residential
development into the West Cape May sewer system. The
availability of that remedy, which assumes the correctness of the
DEP's interpretation of condition seven, does not make the DEP's
declaratory ruling interlocutory in nature. Moreover, even if we
considered that ruling to be interlocutory, we would grant leave
to appeal in the interest of justice.
See R. 2:2-4.
Accordingly, we proceed to the merits of plaintiffs' argument.
II
Before certain types of developments in coastal lands
covered by CAFRA may be constructed, a permit must be obtained
from the DEP.
N.J.S.A. 13:19-5. CAFRA exempts residential
developments with fewer than twenty-five units from this permit
requirement.
N.J.S.A. 13:19-5e(1). Thus, the Wildes would not
be required to obtain a CAFRA permit to construct their proposed
twenty-one unit residential development.
However, a CAFRA permit is required to construct a "public
development,"
N.J.S.A. 13:19-5b(4), which includes wastewater
treatment plants and sewer pipelines.
N.J.S.A. 13:19-3.
Consequently, West Cape May was required to obtain a CAFRA permit
to extend its sewer system, and condition seven of that permit
requires any owner of property that contains wetlands, wetlands
transition buffer areas, or wet or high permeability moist soils
below ten feet in elevation, to obtain written authorization from
the DEP before connecting into that system.
In
In re Cape May County Mun. Utils. Auth.,
242 N.J. Super. 509 (App. Div. 1990), this court held that the DEP may issue a
CAFRA permit for an extension of a sewer system, conditioned upon
the DEP approving any proposed new connection into the system,
including a connection by a proposed new residential development
containing fewer than twenty-five units. We concluded that such
a condition is "authorized by [
N.J.S.A. 13:19-11's] grant of
authority to impose conditions reasonably necessary to 'promote
the public health, safety and welfare . . . and to preserve,
protect and enhance the natural environment.'"
Id. at 516.
Therefore, condition seven of the permit issued to West Cape May
is clearly valid.
Plaintiffs apparently concede that at least part of their
property contains wet or high permeability moist soils below ten
feet in elevation. Thus, under the plain language of the first
sentence of condition seven, plaintiffs would be required to
obtain "written authorization" from the DEP to connect into the
West Cape May sewer system. However, plaintiffs contend that
they are exempt from this requirement because West Cape May's
governing body adopted a resolution purportedly listing all
properties subject to condition seven, which omitted their
property. Plaintiffs characterize the requirement that West Cape
May "adopt a . . . municipal resolution clearly listing all . . .
properties" subject to condition seven as a "delegation [of]
responsibility for identifying those properties requiring [DEP]
approval," and contend that West Cape May's failure to include
their property on the list is binding upon the DEP.
However, the Legislature delegated sole administrative
authority "to achieve CAFRA's highly important purpose of
protecting our fragile coastal area from adverse environmental
impact,"
State Dept. of Envtl. Prot. v. Stavola,
103 N.J. 425,
433 (1986), to the DEP. The Legislature did not delegate any
responsibility for the administration of the CAFRA program to
municipal governments. Moreover, "[t]he general rule is that a
power or duty delegated by statute to an administrative agency
cannot be subdelegated in the absence of any indication that the
Legislature so intends."
Mercer Council No. 4, N.J. Civil Serv.
Ass'n v. Alloway,
119 N.J. Super. 94, 99 (App. Div.),
aff'd o.b.,
61 N.J. 516 (1972). CAFRA contains no such legislative
authorization for the DEP to subdelegate its regulatory authority
to a municipality. In fact, CAFRA reflects a legislative
determination that "municipal land use control [is] inadequate to
assure orderly and environmentally-sound development" in the
coastal area.
In re Egg Harbor Assocs.,
94 N.J. 358, 368 (1983).
Furthermore, the rules and regulations adopted by the DEP to
implement CAFRA,
N.J.A.C. 7:7-1.1 to 9.9, do not purport to
delegate any responsibility for the enforcement of this
legislation to municipal governments. Therefore, we reject
plaintiffs' argument that the second sentence of condition seven
of the permit issued to West Cape May should be construed as a
delegation of authority to the municipality to determine which
property owners must obtain DEP approval before connecting into
the new section of its sewer system.
Instead, we conclude that this provision was simply a
directive to West Cape May to identify those properties that must
obtain the DEP's approval before connecting into the sewer
system, without binding the DEP to the municipality's
determination. We note that the second sentence of condition
seven does not state that notice or an opportunity to be heard
must be given to the owner of any property that West Cape May
proposes to put on the list, which suggests that the inclusion of
a property on the list would not be binding on the property
owner. Most significantly, condition seven does not state that
an owner of property omitted from the list is exempt from
obtaining DEP approval even if the property falls within the
definition of environmentally sensitive land set forth in the
first sentence. Therefore, the second sentence of condition
seven should be viewed as simply an administrative provision,
which requires the permittee to list properties it believes are
required to obtain DEP approval to connect into the system,
without conferring any rights upon an owner of a property
erroneously omitted from the list.
Moreover, if there were any doubt concerning the proper
interpretation of condition seven, we would defer to the DEP's
interpretation. Courts extend substantial deference to an
agency's interpretation of its own regulations,
DiMaria v. Board
of Trs. of Pub. Employees' Ret. Sys.,
225 N.J. Super. 341, 351
(App. Div.),
certif. denied,
113 N.J. 638 (1988), and an agency's
interpretation of the terms of a permit it has issued should be
accorded similar deference.
We also note that even if West Cape May's omission of
plaintiffs' property from the list of properties required to
obtain DEP approval to connect into the sewer system were
considered an act of delegated governmental authority, the
municipality's action would not be immune from correction if it
were later shown to have been erroneous. "[A]dministrative
agencies generally have the inherent power to reopen or to modify
and rehear prior decisions."
In re Trantino,
89 N.J. 347, 364
(1982). "This power to reappraise and modify a prior
determination may be invoked . . . to protect the public
interest . . . ."
Trap Rock Indus., Inc. v. Sagner,
133 N.J.
Super. 99, 109 (App. Div. 1975),
aff'd
69 N.J. 599 (1976).
Consequently, even if the DEP itself had issued a list of
properties required to obtain approval before connecting with the
West Cape May sewer system, and erroneously omitted plaintiffs'
property, the DEP would retain authority to correct the list, at
least in the absence of a showing of justifiable reliance upon
the omission, which plaintiffs did not undertake to establish.
We reject plaintiffs' suggestion that condition seven does
not apply to their proposed development because the construction
permit the DEP issued to West Cape May has expired.
N.J.A.C.
7:7-1.5(b)(8) expressly provides that "conditions imposed by a
permit shall remain in full force and effect so long as the
development or any portion thereof is in existence. . . ."
Because the extension of West Cape May's sewer system to which
plaintiffs propose to connect their development is still "in
existence," condition seven "remain[s] in full force and
effect. . . ."
Finally, we emphasize that our decision is limited to a
determination that plaintiffs must obtain the DEP's approval
before they may connect into the West Cape May sewer system. We
express no opinion concerning the showing plaintiffs must make to
obtain such approval. See
In re Cape May Mun. Utils. Auth.,
supra, 242
N.J. Super. at 516-17.
Accordingly, we reverse the judgment of the Law Division,
treat the appeal as an appeal from the DEP's declaratory ruling
that plaintiffs must obtain the DEP's approval to connect with
the West Cape May sewer system, and affirm that ruling.
Footnote: 1 1 In the unusual situation where it is not feasible or
appropriate for the Appellate Division to hear all claims
asserted in an appeal from state administrative agency action, we
may transfer such claims to the Law or Chancery Division. See
Maisonet v. New Jersey Dep't of Human Servs.,
140 N.J. 214, 226-
28 (1995).