| Alaimo v Town of Fort Ann |
| 2009 NY Slip Op 05238 [63 AD3d 1481] |
| June 25, 2009 |
| Appellate Division, Third Department |
| Ann Marie Alaimo et al., Respondents-Appellants, v Townof Fort Ann et al., Apellants-Respondents. |
—[*1] Harter, Secrest & Emery, L.L.P., Rochester (James C. Moore of counsel), for AtlanticTesting Laboratories, Ltd., appellant-respondent. Carter, Conboy, Case, Blackmore, Maloney & Laird, P.C., Albany (Leah Casey of counsel),for Kubricky Construction Corporation, appellant-respondent. Burke, Scolamiero, Mortati & Hurd, Albany (Thomas J. Reilly of counsel), for HTENortheast, Inc., appellant-respondent. Wein, Young, Fenton & Kelsey, P.C., Guilderland (Paul H. Wein of counsel), forrespondents-appellants.
Lahtinen, J. Cross appeals from an order of the Supreme Court (Krogmann, J.), enteredMarch 21, 2008 in Washington County, which, among other things, partially denied defendants'motions to dismiss the complaint.
The Hadlock Pond dam, which had just been reconstructed, failed catastrophically on July 2,2005. Hadlock Pond is located in the Town of Fort Ann, Washington County, and is created by adam owned by defendant Town of Fort Ann. The original dam was constructed in [*2]the late 1800s, with subsequent repair and replacement over theyears. The cost of maintaining and operating the dam is reportedly paid from revenue receivedfrom a separate taxing district (Lake Hadlock Park District), which is comprised of owners withfrontage on or access rights to the pond. An apparent problem with the dam's spillway resulted inthe subject reconstruction project, which was allegedly completed in the spring of 2005. Shortlythereafter, the dam failed and numerous lawsuits ensued. In those actions, it was asserted that theplans were designed by defendant HTE Northeast, Inc., the work was performed by defendantKubricky Construction Corporation and the materials were tested by defendant Atlantic TestingLaboratories, Ltd..
Plaintiffs, owners from the Lake Hadlock Park District, alleged, among other things, causesof action in negligence and nuisance. While these upstream owners did not suffer the type ofdamages from sudden rushing water sustained by owners of property located downstream fromthe dam, they nonetheless asserted various damages including loss of use of the pond anddamage to their property. Defendants moved to dismiss the complaint for failure to state a causeof action. Plaintiffs opposed the motions and cross-moved for leave to serve an amendedcomplaint adding a cause of action alleging that they were third-party beneficiaries of the Town'scontracts with other defendants. Supreme Court dismissed one cause of action (the third cause ofaction which was premised upon ECL 15-0507), limited the nuisance cause of action andotherwise denied defendants' motions. Plaintiffs' cross motion to amend was also denied.Defendants appeal and plaintiffs cross-appeal.
We consider first defendants' appeal, in which they argue that they did not owe a duty toplaintiffs—upstream owners—and, accordingly, that the action should have beendismissed in its entirety. Procedurally, defendants' appeal involves a CPLR 3211 motion todismiss, where "the court will 'accept the facts as alleged in the complaint as true [and] accordplaintiffs the benefit of every possible favorable inference' " (Nonnon v City of New York, 9 NY3d 825, 827 [2007], quotingLeon v Martinez, 84 NY2d 83, 87-88 [1994]). "[T]he dispositive inquiry is whether[plaintiffs have] a cause of action and not whether one has been stated, i.e., 'whether the facts asalleged fit within any cognizable legal theory' " (IMS Engrs.-Architects, P.C. v State of New York, 51 AD3d 1355,1356 [2008], lv denied 11 NY3d 706 [2008], quoting Leon v Martinez, 84 NY2dat 87-88).
While the scope of duty presents a legal question involving the weighing of a variety offactors (see 532 Madison Ave. Gourmet Foods v Finlandia Ctr., 96 NY2d 280, 288[2001]; Palka v Servicemaster Mgt. Servs. Corp., 83 NY2d 579, 585 [1994]), defendantshave framed the duty issue for purposes of their CPLR 3211 motions as dependent upon whetherplaintiffs sustained only economic damages and they rely heavily upon a case where, in the wakeof construction accidents that temporarily closed sections of New York City, the Court ofAppeals drew the line demarcating the scope of duty to include those who sustained personalinjuries or property damage, but did not extend a duty to businesses suffering solely economicloss (532 Madison Ave. Gourmet Foods v Finlandia Ctr., 96 NY2d at 290-292). Oneweighty factor in that case was the potential for broadly expansive liability to an indeterminateclass of persons (id. at 289-291), a factor which defendants urge can be analogized to thefacts at hand. However, crucial distinctions keep the reins of liability more taut in the currentcase. First, plaintiffs are a determinable group limited to those who pay a special tax to maintainthe dam and either own property adjoining the pond or have rights to use it. Second, accepting astrue all facts asserted by plaintiffs, as we must at this procedural juncture (see IMSEngrs.-Architects, P.C. v State of New York, 51 AD3d at 1356), there are sufficientallegations that plaintiffs sustained legally recognized property damages to avoid dismissal.[*3]
With regard to the potential property damages sustainedby plaintiffs, we initially note that water rights generally constitute property rights (see e.g.Matter of Van Etten v City of New York, 226 NY 483, 486-487 [1919]; Matter ofNiagara Mohawk Power Corp. v Cutler, 109 AD2d 403, 405 [1985], affd 67 NY2d812 [1986]; 78 Am Jur 2d, Waters § 35). Judge Cardozo has instructed that "[t]he law ofwater rights is not an inflexible body of precedent" (Howard v City of Buffalo, 211 NY241, 263 [1914]). While the rights of owners bordering a pond or lake created by a dam aregenerally not the same as the riparian (or littoral) rights of those adjoining a natural body ofwater, the circumstances surrounding the creation and use of an artificial body of water mayunder some circumstances give rise to rights similar to owners of property on the shoreline of anatural body of water (see Alderson v Fatlan, 231 Ill 2d 311, 319-323, 898 NE2d 595,600-602 [2008]; Tarlock, Water Rights & Resources §§ 3:25, 3:26 [2008]; cf.City of Syracuse v Stacey, 169 NY 231, 245 [1901] ["the value of water depends largelyupon surrounding circumstances"]). "Simply put, in some cases, where the usage of the artificialbody of water has long been settled, it may be appropriate to treat the artificial body as the legalequivalent of a natural one" (Alderson v Fatlan, 231 Ill 2d at 322, 898 NE2d at 602;see Hammond v Antwerp Light & Power Co., 132 Misc 786, 797-798 [1928]; cf.Townsend v McDonald, 12 NY 381, 390 [1855]).
Some of the relevant circumstances here include a pond that was reportedly created over 100years ago. Plaintiffs pay a separate tax to one defendant (the Town) for the alleged specificpurpose of keeping the dam maintained and the pond intact. They assert that the pond greatlyenhances the value of their property. That enhancement is allegedly directly related to therecreational opportunities and scenic setting provided by the pond created by the dam. Plaintiffshave set forth sufficient allegations to raise an issue as to whether their property should betreated as having rights similar to those upon a natural body of water. The temporary loss of thatpond can give rise to a cognizable claim. We agree with Supreme Court that dismissal for failureto state a cause of action is not appropriate.[FN*]
We turn to the issues raised by plaintiffs in their cross appeal. They contend that SupremeCourt erred in holding that ECL 15-0507 does not confer a private cause of action. A dam ownerwho violates ECL 15-0507 (1) may be penalized (see ECL 71-1109 [1]), but only theAttorney General is specifically authorized to bring an action to recover those penalties(see ECL 71-1127 [1], [2]). The Second Department has held, with regard to anotherduty imposed by ECL article 15 (see ECL 15-1947 [2]) which is enforceable via ECL71-1127, that a private cause of action was not created (see Nowak v Madura, 304 AD2d733, 733 [2003]). We are [*4]unpersuaded that the statutoryscheme supports a different result for ECL 15-0507 (see generally Sheehy v Big FlatsCommunity Day, 73 NY2d 629, 633-635 [1989]).
Plaintiffs further argue that they should have been permitted to serve a second amendedcomplaint adding a third-party beneficiary cause of action. "It is well settled that a motion toamend the complaint is addressed to the sound discretion of the court and, in the absence of aclear abuse of such discretion, the determination will not be disturbed on appeal" (Aiello vManufacturers Life Ins. Co. of N.Y., 298 AD2d 662, 662 [2002], lv dismissed anddenied 99 NY2d 575 [2003] [citation omitted]). On this record, Supreme Court acted withinits discretion in concluding that the further amendment should not be permitted (seegenerally Fourth Ocean Putnam Corp. v Interstate Wrecking Co., 66 NY2d 38, 44-45[1985]). The remaining arguments of the parties have been considered and found unavailing.
Spain, J.P., Malone Jr., Stein and Garry, JJ., concur. Ordered that the order is affirmed,without costs.
Footnote *: We are not suggesting thatplaintiffs are entitled to all the types of damages they assert and, in fact, it appears that theirremedies, if any, may well be much more circumscribed than set forth in their complaint.Moreover, although defendants do not have identical obligations, we have treated themessentially as a singular entity for the narrow purpose of this appeal since they jointly set forthone aspect of the duty argument as a ground for dismissal as to all. Once the underlying facts aredeveloped through disclosure and plaintiffs' theories fleshed out, summary judgment forsome—or all—defendants may be a viable remedy (see generally Bird v TrustCo. of N.J., 234 AD2d 812, 814 [1996]).