Clarifying Accrual of §1983 Due-Process Claims in Land-Use Certificate of Occupancy Disputes

Introduction

Potter v. Incorporated Village of Ocean Beach, 24-2033-cv (2d Cir. Apr. 10, 2025), addresses when a Section 1983 claim challenging a local government’s revocation of a certificate of occupancy (“CO”) accrues for purposes of the federal statute of limitations. Plaintiff Philip G. Potter—owner of a seasonal home in Ocean Beach, New York—alleged violations of his procedural and substantive due process rights and Monell liability (42 U.S.C. § 1983) arising from (1) a 2011 revocation of his CO, (2) criminal citations in 2012 for alleged code violations, (3) denial of rental‐permit applications in 2016–2018, and (4) the Village’s refusal to hold a state‐court-ordered hearing on the CO revocation. The district court dismissed all claims as time-barred. On appeal, Potter argued accrual did not occur until final Village Board action—never adopted—and that his suit (filed August 29, 2023) was timely. The Second Circuit affirmed.

Summary of the Judgment

The Second Circuit applied federal‐law accrual principles to § 1983 claims and New York’s three-year limitations period (C.P.L.R. § 214[5]). Key holdings:

Claims based on 2012 criminal citations and denials of rental permits in 2016–2018 accrued when Potter knew of the injury and were barred by August 29, 2020.
Claims challenging the 2011 CO revocation likewise accrued when Potter became aware—in 2016–2018—that the Village treated his CO as void and denied rental permits on that basis. By then, he “knew enough of the critical facts” to seek legal advice and bring suit.
Continuing violation and equitable estoppel doctrines did not rescue Potter’s late claims: each permit‐denial was a discrete act, and Potter had earlier challenged the revocation in state court.

The Court therefore affirmed the dismissal under Fed. R. Civ. P. 12(b)(6).

Analysis

Precedents Cited

Owens v. Okure, 488 U.S. 235 (1989): State statutes of limitations govern § 1983 time bar.
Pearl v. City of Long Beach, 296 F.3d 76 (2d Cir. 2002): New York’s three-year C.P.L.R. § 214(5) applies to § 1983.
Wallace v. Kato, 549 U.S. 384 (2007): Accrual occurs when a plaintiff has “a complete and present cause of action.”
Brown Media Corp. v. K&L Gates, LLP, 854 F.3d 150 (2d Cir. 2017), and Pettaway v. Nat’l Recovery Sols., 955 F.3d 299 (2d Cir. 2020): Standards for Rule 12(b)(6) motions.
Kronisch v. United States, 150 F.3d 112 (2d Cir. 1998): Plaintiff accrues when he knows “enough of the critical facts of injury and causation to protect himself by seeking legal advice.”
DeSuze v. Ammon, 990 F.3d 264 (2d Cir. 2021): Federal claim accrues once plaintiff “knows or has reason to know of the injury.”
Ashcroft v. Iqbal, 556 U.S. 662 (2009), and Bell Atlantic v. Twombly, 550 U.S. 544 (2007): Plausibility requirement at pleading stage.

Legal Reasoning

1. Accrual and Limitations
Under Owens and Pearl, New York’s three-year limitations period applies to § 1983 claims. Federal common‐law accrual principles dictate the trigger date. Wallace establishes accrual at “complete and present cause of action.” DeSuze and Veal refine this: accrual occurs once a plaintiff knows—or has reason to know—of the injury and its cause.

2. Discrete versus Continuing Violations
The Court reiterated Morgan’s prohibition on applying the “continuing violation” doctrine to discrete acts. Each criminal citation (2012) and permit denial (2016–2018) was a self-contained wrong that accrued upon notice.

3. Finality in Land-Use Context
While ripeness (Williamson County final-decision requirement) demands de facto finality, equitable tolling requires affirmative misconduct that prevented suit. Here, Potter’s state Article 78 action in 2019 belied any lack of knowledge: by then, he recognized the Village’s position that his CO was void.

4. Affirmative Defense on the Face of the Complaint
The Court confirmed that statute‐of‐limitations defenses may be raised on a Rule 12(b)(6) motion if accrual is evident on the complaint and judicially noticeable materials.

Impact

Potter v. Ocean Beach clarifies accrual of due-process claims in the land-use context:

Plaintiffs must file § 1983 actions within three years of when they know the government has taken a definitive position inflicting injury, even if administrative appeals remain pending.
Discrete government actions—e.g., permit denials or code‐enforcement citations—each trigger the limitations clock.
Tolling doctrines (continuing violation, equitable estoppel) are unavailable absent clear, ongoing coercion or concealment preventing suit.
Local governments can rely on summary-order dismissals under Rule 12 when accrual dates are uncontested and appear in the complaint.

Complex Concepts Simplified

§ 1983 Claim: A lawsuit against state or local officials for violating federal constitutional rights.
Certificate of Occupancy (CO): A permit issued by a municipality certifying that a building complies with code and is safe to inhabit.
Accrual: The moment when a legal claim “crystallizes”—i.e., the plaintiff has enough facts to file suit and obtain relief.
Statute of Limitations: A deadline by which a plaintiff must file suit; under New York law, three years for § 1983 claims.
Continuing Violation Doctrine: Inapplicable to campus of discrete incidents; it applies only when the harm is a single, ongoing wrong.
Equitable Estoppel: Prevents a defendant from asserting a time bar if its own misconduct induced the plaintiff’s delay—but requires that the plaintiff knew of the cause of action yet was misled into postponing suit.
Rule 12(b)(6): Motion to dismiss for failure to state a claim; allows courts to consider the complaint and documents integral or judicially noticed.

Conclusion

Potter v. Incorporated Village of Ocean Beach establishes that § 1983 due-process claims tied to land-use decisions accrue when the plaintiff understands the government’s definitive position and suffers a discrete injury. Municipal authorities and property owners alike now have clear guidance: challenges to revocations or permit denials must be filed within three years of the decision that concretely injures the plaintiff, regardless of pending administrative appeals. This decision sharpens the intersection of federal accrual rules and local land-use finality requirements, ensuring both timely enforcement of constitutional rights and predictability for municipal regulatory actions.