The Rockaway Valley Regional Sewerage Authority (RVRSA) recently won a huge victory in its decade-long battle with the City of Jersey City in a ruling that will likely be worth hundreds of millions of dollars. In a Superior Court ruling, in Jersey City Municipal Utilities Auth., et al. v. Town of Dover, et al., the judgment affirms the responsibility of Jersey City to pay its share of the annual cost of operating and maintaining the RVRSA wastewater treatment facilities – currently approximately $3.5 million – for as long as the facilities are maintained in operation. The RVRSA facilities protect the water quality of the Rockaway River, a source of public water supply for Jersey City. On December 13, 2018, the Appellate Division rejected the Plaintiffs’ request for an interlocutory appeal of the trial court decision.
Facing one of the state’s largest law firms, Riker Danzig, representing Jersey City, the Rockaway Valley Regional Sewerage Authority, was represented by a three-attorney team from 12-lawyer Maraziti Falcon, LLP.
Maraziti Falcon’s team was comprised of Joseph Maraziti, Jr. Andrew Brewer and Christopher Miller. Christopher Miller explained that over the nearly nine years of litigation the issues were narrowed before trial by summary judgment motions that foreclosed the City from litigating issues it previously waived in the 1984 Settlement.
According to Maraziti, who participated in the 1968 and 1984 litigation, the relationship between Jersey City and the RVRSA began around 1920, when Jersey City agreed to build and operate a sewage treatment plant in Morris County to treat the municipal sewage of nine towns along the Rockaway River in order to prevent contamination of the Jersey City water in the Boonton Reservoir. In exchange, those towns required the closure of all septic systems and built and maintained a sewage collection system. In 1968, Jersey City filed a suit seeking to end the relationship. The parties settled in 1971, resulting in the formation of the RVRSA; Jersey City was a member, with an obligation to pay a portion of the cost to build a new sewage treatment facility, as well as the annual costs of operation, maintenance and repair of that facility. In 1984, the 1971 settlement was slightly modified by a second litigation filed by Jersey City..
Jersey City filed litigation for a third time, in 2010, seeking a ruling by the Court that the first two settlements should be voided and/or had come to an end by their terms. After a recent thirteen-day bench trial before the Honorable Stuart Minkowitz, A.J.S.C., the Court rejected the claims of Jersey City. Minkowitz ruled that the 1971 and 1984 settlements remain valid and enforceable, and held that Jersey City had breached the agreements.
While it was a substantial victory for the RVRSA, the victory was a partial one because there will be a second trial, likely in mid-2019, to determine the amount of damages arising from the breach by Jersey City. The initial decision did not involve the payment of damages for past obligations, but rather held in a remarkably significant decision that the plaintiffs are still contractually obligated to pay a portion of the RVRSA’s annual operation, repair and maintenance costs for the indefinite future. “While the eventual amount of that obligation will be impacted by factors in the future, even the plaintiffs have acknowledged in a brief filed with the Appellate Division that the decision will potentially result in the obligation to make payments of hundreds of millions of dollars,” said Brewer.