Pulte Homes of New York, LLC v. Town of Carmel
7:16-cv-08093
S.D.N.Y.Sep 5, 2017Background
- Pulte Homes owns ~100 acres in Town of Carmel divided into Lots 3–5; the Planning Board approved a 313-unit development in 2006 and later imposed recreation fees per unit under local law.
- Pulte paid recreation fees under protest: $385,000 in 2008 (Lot 4) and $364,000 in 2013 (Lots 3 and 5), then challenged the fees in Article 78 proceedings.
- The state courts split: Appellate Division reversed the 2008 fee imposition for lack of individualized findings and remitted for further consideration; the 2013 fees were annulled by the state trial court (Supreme Court, Putnam County) but that court did not order refunds; motions to secure refunds in state court were denied and the denial was affirmed on appeal.
- Pulte commenced this § 1983 action in October 2016 seeking refund of $749,000 paid plus additional damages, alleging equal protection and due process violations and ongoing economic injury from defendants’ refusal to refund and their position that approvals are invalid.
- Defendants moved to dismiss under Rule 12(b)(6), arguing statute of limitations and res judicata; the district court treated facts in the complaint as true and evaluated accrual, continuing-violation and preclusion doctrines.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Statute of limitations (accrual) | Pulte asserts claims based on payments made under protest and ongoing injury justify claims for both 2008 and 2013 fees | Defendants argue § 1983 claims are time-barred if outside 3-year limitations (accrual when plaintiff knew of harm) | Claims based on 2008 Resolutions are time-barred; 2013-based claims are timely (action filed Oct 17, 2016; 3-year window back to Oct 17, 2013) |
| Continuing-violation tolling | Pulte contends refusal to refund and asserted invalidation of approvals create an ongoing violation that tolls limitations | Defendants say each wrongful act (payment) accrued at time of payment; no compelling continuing policy or covert pattern alleged | Court rejects continuing-violation theory: Pulte knew the injury when it paid under protest; allegations insufficient to show compelling circumstances |
| Equitable estoppel | Pulte argues defendants’ communications about state-court rulings induced delay in suing | Defendants deny misrepresentation or conduct that reasonably prevented suit | Court rejects estoppel: Pulte failed to plausibly allege fraud, misrepresentation, or reasonable reliance that prevented timely filing |
| Res judicata / claim preclusion | Pulte contends Article 78 did not provide full relief (damages, refunds, ongoing economic injury) so federal suit is permissible | Defendants argue prior state Article 78 decisions preclude relitigation | Court holds res judicata inapplicable to the surviving 2013-based § 1983 claims because Article 78 could not have afforded the monetary/damages relief Pulte now seeks |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (standards for pleading and plausibility)
- Eagleston v. Guido, 41 F.3d 865 (2d Cir.) (accrual rule for § 1983: plaintiff knows or should know of harm)
- Singleton v. City of New York, 632 F.2d 185 (2d Cir.) (accrual and continuing-violation limits)
- Delaware State College v. Ricks, 449 U.S. 250 (continuing impact does not itself create continuing violation)
- Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75 (full faith and credit / preclusion principles for state judgments)
- Vargas v. City of New York, 377 F.3d 200 (2d Cir.) (Article 78 may not provide full relief; res judicata may not bar subsequent § 1983 claims)
- Duane Reade, Inc. v. St. Paul Fire & Marine Ins. Co., 600 F.3d 190 (2d Cir.) (res judicata / claim preclusion elements)