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(NOTE: The status of this decision is Unpublished.) Original Wordprocessor Version (NOTE: The status of this decision is Published.)

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-2801-08T2

GARY SMITH and EILEEN SMITH,

Plaintiffs-Appellants/
APPROVED FOR PUBLICATION

August 10, 2011

Cross-Respondents,

APPELLATE DIVISION

v.

JERSEY CENTRAL POWER & LIGHT COMPANY,

Defendant-Respondent/

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Cross-Appellant,

and

FIRST ENERGY CORP.,

Defendant.

________________________________________________________ August 10, 2011 Argued December 14, 2010 - Decided

Before Judges Parrillo, Yannotti and Skillman.

On appeal from Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-3236-03.

William J. Wolf argued the cause for appellants/cross-respondents (Bathgate, Wegener & Wolf, attorneys; Mr. Wolf and Pamela Madas Snyder, on the briefs).

Arnold R. Gerst argued the cause for respondent/cross-appellant (Weiner Lesniak, attorneys; Mr. Gerst, of counsel and on the brief; Richard L. Rudin, Margaret A. Miller and Jeanne A. McManus, on the brief).

The opinion of the court was delivered by SKILLMAN, J.A.D. (retired and temporarily assigned on recall). This is an unusual case involving a nuisance claim based on "neutral-to-earth voltage" (NEV), also called "stray voltage" or "stray current," passing along the ground of a residential property. Plaintiffs, Gary and
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Eileen Smith, husband and wife, sued defendant, Jersey Central Power & Light Company, because high NEV levels from its electrical distribution system gave them shocks in their backyard. The jury found defendant liable for nuisance and awarded plaintiffs $145,000 for property damage and $50,000 for interference with the use of their property. Plaintiffs appeal, challenging the trial court's dismissal of their inverse condemnation claim and the denial of their claim for certain taxed costs. Defendant cross-appeals, asserting various trial errors. We reject the arguments presented in both the appeal and cross-appeal, and affirm.

I.

Plaintiffs and their three young boys lived in a single family house in Brick. The backyard contained a cement patio, a swing set, a sandbox, an above-ground pool with metal ladders, and a hot tub. After returning home from a family vacation in July 2002, Gary walked barefooted to the hot tub, put his arm into the water to feel the temperature, and felt an electric shock, like "a tingling, hurting sensation," travel up his arm to his chest. The next day, he put his arm in the hot tub again and received an electric shock so strong it felt as though someone had punched him in the chest. He asked Eileen to feel the water. She felt nothing while wearing her shoes, but when she took them off and touched the water, she felt a "tingling sensation, a buzzing sensation," as if she had inserted a fork into a toaster. An electrician plaintiffs called to investigate the problem found very high levels of electricity in the ground surrounding the hot tub and swing set. The electrician also determined that the source of the problem was not within plaintiffs' house and suggested they call defendant. Defendant sent investigators to plaintiffs' house, who concluded after extensive testing that the source of the electric shock problem in their backyard was defendant's electrical distribution system, specifically NEV. It is not necessary to describe NEV in detail to understand the issues presented by this appeal. Suffice it to say that although electricity is distributed to users through electrical wires, all electricity leaving an electrical substation must return to the substation to complete the circuit, and although returning electricity passes mostly through wires, it sometimes goes through the ground when the wires become overloaded. Because electricity seeks the path of least resistance, when the return is through the ground, the electricity will tend

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to ground to such things as pools, hot tubs, outdoor irrigation systems, faucets, and swing sets.

1

Although NEV does not ordinarily pose a problem to homeowners, the high level of NEV in the backyards of plaintiffs and some of their neighbors created a significant problem, which was corroborated by defendant's testing. One of defendant's investigators advised plaintiffs to always wear shoes when going outside and not to touch anything metal or wear wet clothing outside their house. Following the receipt of this advice and fearing for their family's safety, plaintiffs filled in the sandbox, dismantled the swing set and pool in their backyard, and started wearing shoes both inside and outside. They also planned family activities away from the house, and stopped using their backyard. They spent $29,400 to install a second-story fiberglass deck onto their house, so their sons would have a place to play outside without touching the ground. The Board of Public Utilities retained a consultant to investigate the NEV problem in plaintiffs' neighborhood, who concluded that "the stray current problems in the neighborhood" were "very complex and [could] be solved [only] by applying a system wide solution." The BPU subsequently ordered defendant to implement the consultant's recommendations "to mitigate the potential for future occurrences of stray voltage." Defendant undertook extensive efforts over a period of several years to correct the problem. The extent to which those efforts succeeded was a contested issue at the trial of this case. Plaintiffs brought this action against defendant and its parent corporation, First Energy Corp., which was dismissed from the case before trial. Plaintiffs' complaint asserted various theories of liability, including negligence, nuisance, trespass, inverse condemnation, and negligent infliction of emotional distress. The case was tried over the course of twelve days. Plaintiffs presented testimony by a real estate valuation expert, who expressed the opinion that the presence of NEV on plaintiffs' property had reduced its market value to zero and that even if the NEV was fully remediated, the "stigma" from that problem would reduce the property's value from $460,000 to $345,000. Plaintiffs also presented testimony by their treating psychiatrist and an expert psychologist, who expressed the opinion that plaintiffs' fear of the NEV had caused them to suffer from anxiety, which was being treated by medication. At the close of plaintiffs' case, the trial court granted defendant's motion to dismiss plaintiffs' inverse
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condemnation claim. At the conclusion of the case, the jury determined that plaintiffs had no cause of action against defendant for negligence, trespass, or negligent infliction of emotional distress. However, the jury returned a verdict in plaintiffs' favor for nuisance, awarding them $145,000 for property damage and $50,000 for interference with the use of their property. The jury also determined that there was no basis for an award of damages for pain and suffering or emotional distress. Based on the jury verdict, the trial court entered judgment in plaintiffs' favor for $195,000, plus prejudgment interest of $34,512.21. In addition, the court determined that plaintiffs were entitled to taxed costs. Plaintiffs applied for taxed costs in the amount of $49,717.11. The trial court denied most of the taxed costs sought by plaintiffs and awarded them only $883.44. Following the entry of judgment, defendant moved to set aside the jury verdict based on plaintiffs' installation of a swimming pool in their backyard a few months after the verdict. The trial court denied this motion. Plaintiffs appeal from the dismissal of their inverse condemnation claim and denial of the full amount of their application for $49,717.11 in taxed costs. Defendant cross-appeals from the trial court's denial of its motion to set aside the nuisance verdict in plaintiffs' favor and from the award of prejudgment interest on the $145,000 verdict for property damage. We reject all of the arguments presented on both the appeal and cross-appeal and affirm.

II.

Defendant moved to dismiss plaintiffs' appeal from the dismissal of their inverse condemnation claim on the ground that it was not filed within the forty-five day period allowed by Rule 2:4-1. We initially reserved decision on this motion, which we now deny. The essential premise of defendant's motion was that final judgment was entered on May 9, 2008. Since plaintiffs did not file their notice of appeal until February 6, 2009, the appeal would have been untimely if

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this premise was correct. However, we conclude that final judgment was not entered until January 16, 2009, when the court entered an order memorializing its rulings regarding plaintiffs' entitlement to taxed costs. The May 9, 2008 "judgment for plaintiffs" appears on its face to be a final judgment. Moreover, the provision in the order awarding plaintiffs taxed costs, without specifying the amount, would not ordinarily prevent it from being treated as final because a determination of the amount of taxed costs is usually a routine ministerial function performed by the clerk of the court. However, the amount of taxed costs in this case was a disputed issue that had to be determined by the trial court. Plaintiffs applied to the clerk for an award of nearly $50,000. Defendant opposed this application, and the dispute was brought before the court to rule upon. Both parties submitted briefs, oral argument was conducted, and the court rendered an oral opinion adjudicating the dispute and entered the January 16, 2009 order memorializing its rulings. For a judgment to be final and therefore appealable as of right, it "must dispose of all claims against all parties." S.N. Golden Estates, Inc. v. Cont'l Cas. Co., 317 N.J. Super. 82, 87 (App. Div. 1998). This rule is "no less applicable to an appeal . . . of an issue, such as counsel fees and costs, that ought to have been resolved before final appellate consideration." Shimm v. Toys From the Attic, Inc., 375 N.J. Super. 300, 304 (App. Div. 2005). Therefore, if plaintiffs had attempted to appeal or cross-appeal the dismissal of their inverse condemnation claim before their claim for costs had been adjudicated by the trial court, it would have been subject to dismissal as interlocutory. Accordingly, we deny defendant's motion to dismiss the part of plaintiffs' appeal that challenges the dismissal of their inverse condemnation claim.

III.

In addressing plaintiffs' argument that the trial court erred in dismissing their inverse condemnation claim, we first note that plaintiffs do not seek a reversal and remand for a new trial on this claim. Rather, plaintiffs seek a declaration "as a matter of law" based on the record developed at trial "that inverse condemnation
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has occurred." Moreover, plaintiffs do not seek any damages on their inverse condemnation claim in addition to the $195,000 the jury awarded on their nuisance claim. The only relief plaintiffs seek is a remand "for the limited purpose of awarding legal fees, costs, disbursements and expenses, including reasonable appraisal and engineering fees to the plaintiffs, as required by N.J.S.A. 20:3-26(c)." Therefore, the issue before us is not whether the trial court erred in dismissing plaintiffs' inverse condemnation claim, but only whether plaintiffs are entitled, without a new trial on that claim, to an award of legal fees and litigation costs under N.J.S.A. 20:3-26(c). The Supreme Court of the United States has distinguished between taking cases involving "[1] a permanent physical occupation, [2] a physical invasion short of an occupation, and [3] a regulation that merely restricts the use of property." Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 430, 102 S. Ct. 3164, 3173, 73 L. Ed.2d 868, 879 (1982); see also Tuthill Ranch, Inc. v. United States, 381 F.3d 1132, 1136-38 (Fed. Cir. 2004); Boise Cascade Corp. v. United States, 296 F.3d 1339, 1353 (Fed. Cir. 2002), cert. denied, 540 U.S. 1075, 124 S. Ct. 940, 157 L. Ed.2d 746 (2003); Simmons v. Loose, 418 N.J. Super. 206, 233-35 (App. Div. 2011). It is only in the first category of case, "when the physical intrusion reaches the extreme form of a permanent physical occupation," that a taking will be found, regardless of the degree of interference with the property owner's use of his land. Loretto, supra, 458 U.S. at 426, 102 S. Ct. at 3171, 73 L. Ed. 2d at 876. "[A] permanent physical occupation is a governmental action of such a unique character that it is a taking without regard to other factors that a court might ordinarily examine." Id. at 432, 102 S. Ct. at 3174, 73 L. Ed. 2d at 880. However, if a physical invasion of property falls short of a permanent occupation, a "balancing process" that includes consideration of the degree of interference with the property owner's use of his land is required to determine whether a taking has occurred. Ibid.
3 2

This case clearly does not involve a permanent physical occupation of plaintiffs' property; defendant did not, for example, erect utility poles on part of plaintiffs' property. Plaintiffs have continued to occupy and use all of their property even though the NEV from defendant's electrical distribution system interfered with that use. Moreover, that interference was temporary or intermittent, rather than permanent; or at least a trier of fact could reasonably have reached this conclusion based on defendant's proofs. Although a taking may be found in such a case, this determination depends upon all the circumstances of defendant's infringement upon plaintiffs' use of their property, including the extent and

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duration of that infringement. See Kaiser Aetna v. United States, 444 U.S. 164, 177-80, 100 S. Ct. 383, 391-93, 62 L. Ed.2d 332, 344-46 (1979); Ark. Game & Fish Comm'n v. United States, 637 F.3d 1366, 137779 (Fed. Cir. 2011); Tuthill Ranch, supra, 381 F. 3d at 1137-38; Simmons, supra, 418 N.J. Super. at 23435; Rohaly v. State, Dep't of Envtl. Prot., 323 N.J. Super. 111, 116-18 (App. Div. 1999). Such a determination requires development of a full record and fact finding. However, as previously discussed, plaintiffs do not seek a remand for a new trial for this purpose. Instead, they argue that the jury's verdict in their favor on their nuisance claim "establishes that the plaintiffs proved a claim for inverse condemnation," and therefore, this court "should reverse the order of the trial court that dismissed the plaintiffs' inverse condemnation claim, and declare that the plaintiffs established, through the jury's verdict, a claim for inverse condemnation." We reject this argument because the elements of a claim for inverse condemnation where there has been no permanent physical occupation of the landowner's property are significantly different from the elements of a claim for nuisance. To prevail on a nuisance claim, a plaintiff is not required to show that an interference with the use of his property was permanent. See Russo Farms, Inc. v. Vineland Bd. of Educ., 144 N.J. 84, 100-03 (1996). Although the jury awarded plaintiffs substantial damages for nuisance, we cannot determine from the verdict whether the jury found that the effects of the NEV upon plaintiffs' use of their property was permanent or that the interference was only temporary but was extremely serious for some period of time. Thus, the jury's verdict on the nuisance claim does not necessarily reflect the findings that would be required to establish an inverse condemnation claim. Our conclusion that the jury's findings on plaintiffs' nuisance claim do not provide the factual foundation required for a judgment in their favor on the inverse condemnation claim is also supported by the fact that there is a substantial body of case law dealing with property owners' claims against electric utilities for NEV, mostly claims by dairy farmers predicated on alleged decreases in the milk producing capacity of their cows, based on negligence, nuisance, and other common law torts. See generally 8A Nichols on Eminent Domain

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