Potter v. Incorporated Village of Ocean Beach: Accrual and Limitations in § 1983 Land-Use Claims

Introduction

In Potter v. Incorporated Village of Ocean Beach, 24-2033-cv (2d Cir. Apr. 10, 2025), the Second Circuit addressed when a § 1983 due process claim in the land-use context accrues for statute-of-limitations purposes. Plaintiff Philip G. Potter, owner of a seasonal residence in Ocean Beach, challenged (1) the revocation of his Certificate of Occupancy (CO) issued in 2010; (2) criminal citations under local building codes in 2012; (3) repeated denials of rental permits 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, and Potter appealed. This summary order affirms dismissal, clarifying accrual principles for discrete land-use violations and emphasizing the three-year limitations period drawn from New York law.

Summary of the Judgment

The Second Circuit affirmed the district court’s Rule 12(b)(6) dismissal of Potter’s § 1983 procedural and substantive due process claims and his Monell theory against the Village and its officials. Key holdings:

1. Claims based on the 2012 criminal citations accrued in 2012 and were thus untimely when filed in August 2023 (three-year limitations period).
2. Claims based on the 2016–2018 denials of rental permits likewise accrued on each denial, all falling outside the three-year window.
3. Claims challenging the CO revocation accrued, at the latest, when Potter knew the Village had taken a final position—no later than 2018—and therefore also expired before August 2020.
4. The continuing-violation doctrine and equitable estoppel did not rescue any claim based on discrete acts or the timing of the revocation hearing process.

Analysis

1. Precedents Cited

The court’s analysis relied on a network of Supreme Court and Second Circuit precedents:

• Owens v. Okure, 488 U.S. 235 (1989): Establishes that state personal injury statutes of limitations govern § 1983 claims.
• N.Y. C.P.L.R. § 214(5): Prescribes a three-year limitations period for personal injury actions in New York.
• Wallace v. Kato, 549 U.S. 384 (2007): Articulates that a § 1983 claim accrues when a plaintiff has “a complete and present cause of action,” i.e., knowledge of injury and causation.
• Veal v. Geraci, 23 F.3d 722 (2d Cir. 1994): Defines accrual as when “the plaintiff knows or has reason to know of the injury which is the basis of his action.”
• Kronisch v. United States, 150 F.3d 112 (2d Cir. 1998): Clarifies that accrual occurs when a plaintiff knows “enough of the critical facts of injury and causation to protect himself by seeking legal advice.”
• Pettaway v. Nat’l Recovery Sols., 955 F.3d 299 (2d Cir. 2020): Frames the standard for Rule 12(b)(6) review in the Second Circuit.
• Whiteside v. Hover-Davis, Inc., 995 F.3d 315 (2d Cir. 2021): Explains when a statute-of-limitations defense may be raised on a Rule 12(b)(6) motion.

2. Legal Reasoning

The court’s decision unfolds under two main headings: accrual for § 1983 claims and the scope of rule-12(b)(6) review of timeliness defenses.

a. Accrual of § 1983 Claims
Under federal law, § 1983 claims “accrue when the plaintiff has a complete and present cause of action”—that is, when the plaintiff knows both the injury and its governmental cause. See Wallace. In land-use disputes, courts additionally ask whether the government’s action is “de facto final.” See Pakdel v. City & Cnty. of San Francisco, 594 U.S. 474 (2021). Here:

• 2012 Criminal Citations: Potter knew in early 2012 that he faced due-process injuries—the threat of fines and prosecution under building codes. Those claims accrued promptly in 2012.
• 2016–2018 Rental Denials: Each denial signaled that the Village regarded the 2010 CO as revoked. Potter alleged he lost “potentially lucrative rental income” each year. The accrual rule binds each discrete denial to its date.
• CO Revocation: Although the Village initially sent a notice of revocation in July 2011 and later appointed a hearing officer, Potter’s own allegations show that by 2016 at the latest, he understood the Village had taken a “final” position (denying permits on the ground of no valid CO). His later Article 78 efforts confirm his awareness of injury and causation well before August 2020.

b. Raising a Limitations Defense on Rule 12(b)(6)
While statutes of limitations are usually affirmative defenses, the court may entertain them on a pre-answer motion if the defect “appears on the face of the complaint” or from documents judicially noticed. See Whiteside. Potter’s complaint and incorporated documents plainly showed accrual dates beyond three years before his August 2023 filing.

c. Rejection of Equitable Doctrines

• Continuing Violation Doctrine: Limited to claims that “by their nature accrue only after … threshold mistreatment.” Discrete acts (citations and denials) do not qualify.
• Equitable Estoppel: Available only if the defendant’s misconduct caused the plaintiff to delay suit despite knowing of the claim. Potter promptly challenged the CO revocation in state court in 2019.

3. Impact

Potter cements several critical guideposts for future § 1983 land-use litigation:

• Land-use actors and property owners must track discrete official actions against property rights—each notice of violation or permit denial may trigger a new accrual date.
• Plaintiffs cannot rely on protracted administrative or Article 78 proceedings to postpone accrual; knowledge of a municipality’s “de facto final” stance suffices.
• Monell claims hinging on patterns of municipal process misconduct will face close timeliness scrutiny when discrete acts are alleged.
• Litigants in the Second Circuit should expect that summary orders, though non-precedential, will be heavily cited for accrual and ripeness rules in the land-use context.

Complex Concepts Simplified

Accrual: A claim “accrues” when you know you’ve been harmed and who harmed you—no need to wait for a final court judgment.

Monell Liability: A municipality can be sued under § 1983 only if its own policies or customs caused the constitutional violation.

Ripeness in Land-Use: Courts require a “final decision” (or equivalent) from municipal bodies before reviewing land-use claims.

Continuing Violation Doctrine: Applies when wrongful conduct is ongoing in nature (e.g., a hostile work environment), but not to individual, separate acts like multiple permit denials.

Conclusion

Potter v. Village of Ocean Beach underscores that § 1983 due process claims based on land-use decisions accrue when plaintiffs know both their injury and the government’s final position. Discrete municipal acts—whether criminal citations, permit denials, or revocation notices—each carry their own accrual date. A three-year limitations window applies in New York, and plaintiffs must file within three years of accrual to avoid dismissal on timeliness grounds. This decision provides clear guidance to property owners and municipal defendants alike, sharpening the accrual analysis in the land-use and procedural-due-process context.