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Daily Decision Service Alert: Vol. 21, No. 239 ? December 11, 2012
New Jersey Law Journal
STATE COURT CASES
CIVIL PROCEDURE DISMISSAL
07-2-8413 Gaskill v. Abex Corporation, App. Div. (per curiam) (21 pp.) Plaintiff filed a complaint alleging that he developed mesothelioma through the "inhalation and ingestion" of asbestos dust and particles while working as a mechanic's helper at auto body shops, and while assisting his grandfather in automotive maintenance and repair work, beginning in the early 1980s. The thirteen named defendants were alleged to have marketed asbestos-containing products for the automotive industry. Plaintiff appeals from an order dismissing with prejudice his complaint for personal injury, as a consequence of plaintiff's pervasive lies during discovery and his efforts to subvert the discovery process. The appellate panel affirms essentially for the reasons expressed by the trial judge. Plaintiff's conduct not only is an egregious violation of the discovery rules, but also is clearly a fraud upon the court. Plaintiff's deliberate concealment and outright lies during the discovery process warrant imposition of the ultimate sanction of dismissal of his complaint with prejudice.
43-2-8414 Paulsboro Refining Company, LLC v. Township Of Greenwich, App. Div. (per curiam) (16 pp.) Plaintiff Paulsboro Refining Company appeals from an order declaring that "foundations for manufacturing, production[,] and process equipment" are not exempt from the Uniform Construction Code (UCC), and are therefore subject to municipal permitting and inspections. Plaintiff attempted to install a foundation for its process equipment at one of its refineries without obtaining a construction permit. As a result, a municipal code official from defendant Township of Greenwich issued a stop-work order. The appellate panel holds that the Department of Community Affairs did not exempt foundations from the UCC in general only the specific type of foundation noted in subsection N.J.S.A. 5:23.9.7(b)13. Thus, the panel remands and directs the judge to make additional findings of fact findings of fact and conclusions of law regarding the type of foundation at issue and whether it is exempt under the UCC.
DAMAGES AND REMEDIES
60-2-8415 Peek v. Johl & Co. Inc., App. Div. (per curiam) (12 pp.) Plaintiffs, husband and wife, appeal from a final judgment entered after a bench trial in this business dispute concerning their insurance business, which they founded in the 1950s. Plaintiffs and defendants entered into a written agreement in which plaintiffs sold their business to defendants. The trial judge found plaintiffs benign explanation of post-sale events was not credible, that plaintiffs had breached the restrictive covenant in the agreement, and that it was a material breach of the overall agreement. The judge thereby excused defendants from continuing to make further payments on the promissory note or on the lease pursuant to the agreement. The record adequately supports the finding that plaintiffs materially breached the covenant by diverting commission checks payable to plaintiff individually to his home address without sharing any of those proceeds with defendants. Because the material breach prevents a claim of substantial performance, the trial court committed no error in granting defendants relief on their counterclaim. Finally, given the finding of wrongful conduct, it is not unjust for defendants to be relieved of their further payment responsibilities under the contract and lease. The trial court's final judgment is affirmed.
FAMILY LAW CHILD CUSTODY
20-2-8416 A.K.L. v. M.S.L., App. Div. (per curiam) (10 pp.) Defendant appeals from two interlocutory orders awarding sole custody of the parties' child to plaintiff and from the dual judgment of divorce. The panel affirms, finding that the Family Part judge's decisions - including that M.S.L. engaged in force-feeding the child, screamed and cursed at and slapped the child, and was rigid and uncompromising and required a psychiatric evaluation and continued therapy, and that the child's best interest required that A.K.L be granted sole legal and residential custody - are supported by substantial credible evidence, are consistent with applicable law, and do not represent an abuse of discretion. The judge did not err and carefully explained her reasons in rejecting the expert's view that giving M.S.L. custody would be in the child's best interests. Nor did the judge err in her award of equitable distribution, or in awarding A.K.L. counsel fees after finding that M.S.L. had litigated numerous issues in bad faith, relied on perjured testimony, and had caused A.K.L. to incur hundreds of thousands of dollars in counsel fees.
FAMILY LAW CHILD SUPPORT
20-2-8417 Mazyk v. Cozze, App. Div. (per curiam) (10 pp.) Defendant appeals the Family Part order ruling that income from his self-settled special needs trust, which was funded by a settlement award from a motor vehicle accident and which met the requirements of 42 U.S.C.A. section 1396p(d)(4)(A), be recognized for the purpose of calculating his child support obligation. The panel affirms, finding that while those assets are not available to satisfy Cozze's child support obligations, the trial judge correctly determined that the trust income shall be considered income for inclusion in calculations to determine his child support obligations.
GOVERNMENT SEWERAGE CHARGES
21-2-8418 Hillside Estates Inc. v. Sayerville, App. Div. (per curiam) (28 pp.) Plaintiff, the owner of a large apartment complex, Winding Woods Apartments, challenges the trial court's grant of summary judgment to defendant in this action in lieu of prerogative writs contesting, under statutory and constitutional theories, defendant's classification of Winding Woods as an industrial user, resulting in Hillside having to pay a higher sewerage rate than other residential property owners that use the borough's sewerage system, including six other apartment complexes. The borough contended that the rate differential is justified because Winding Woods, unlike the other local residential properties, has its own sewerage meter, which shows that the composition of Winding Woods' sewage exceeds the maximum standards for a residential user in the borough. The panel reverses on non-constitutional grounds, finding that the record establishes that the borough's method of calculating Winding Woods' sewerage fees is not equitable, as required by N.J.S.A. 40A:26A-10. Its classification of Winding Woods as an industrial user, while simultaneously treating all other apartment complexes as residential users, results in a system that does not impose sewerage charges in fair proportion to the user's characteristics. Subject to the resolution of certain open issues, including the timeliness of Hillside's suit, the matter is remanded for the trial court to fashion an appropriate remedy, on notice to interested parties.
INSURANCE ATTORNEY FEES
23-2-8419 Lugo v. Marieco, LLC, App. Div. (per curiam) (7 pp.) Carmen Marchitello, defendant and third-party plaintiff, appeals the denial of his application for an award of counsel fees from third-party defendant Travelers Property Casualty Company of America, asserting that Travelers' settlement with plaintiffs makes him a successful claimant. The trial judge denied Carmen's claim for counsel fees because of questions regarding ownership of the vehicle involved in the accident which resulted in injury to plaintiffs. Carmen sidestepped placing title to the vehicle in his or his sons name, thereby avoiding New Jersey's statutory scheme involving ownership, registration, reporting, and dealer licensing requirements. This practice is known as "title jumping," and is apparently not uncommon in the used car industry. The confusing nature of the status of the title was the sole cause of the insurance company's initial denial of coverage; litigation ensued in order for the true owner of the vehicle to be identified. Since the Marchitellos' conduct "contributed substantially to the necessity for the litigation," the judge appropriately denied counsel fees.
23-2-8420 Meyers v. New Jersey Manufacturers Insurance Company, App. Div. (per curiam) (10 pp.) In this insurance coverage action, plaintiff was the named insured on a homeowner's insurance policy issued by defendant New Jersey Manufacturers Insurance Company (NJM). The policy insured plaintiff's single-family residence located on South Woodleigh Drive, Cherry Hill, New Jersey. A jury found in favor of defendant after answering the first question on the verdict sheet: Was the property [on] South Woodleigh Drive in Cherry Hill, New Jersey the subject of vandalism and/or arson and/or property theft causing damage or loss as a result of the conduct of a party other than the plaintiff?" After deliberating for less than two hours, the jury answered "no" to question one by a vote of six to one. The trial court entered a judgment of no cause of action in favor of NJM and dismissed plaintiff's complaint with prejudice. Plaintiff appeals from that judgment and a subsequent order denying her motion for a new trial. The trial court found there was substantial credible evidence to support the jury verdict. The appellate panel agrees and affirms, finding no miscarriage of justice and no basis for a new trial.
LABOR AND EMPLOYMENT UNIONS
25-2-8421 International Association of Machinists and Aerospace Workers, AFL-CIO v. Werner-Masuda, App. Div. (per curiam) (61 pp.) In these actions arising out of the creation of the Union of Independent Flight Attendants (UIFA) by a group of flight attendants who were unhappy with plaintiff, their existing union, the UIFA and McCormick Advisory Group (MAG), which had been hired by the attendants to advise on the creation of UIFA, appeal orders entered by the Law Division in connection with UIFA's claims against MAG for breach of contract. In a separate appeal, Herold Law, P.A. and Charles F. Waskevich, Jr., a partner at Herold Law, appeal from an order of the Law Division imposing sanctions in connection with the mistrial declared during the first trial of UIFA's claims against MAG, at which they represented UIFA. The appeals were argued together and the panel consolidates them for the purposes of this opinion. It affirms all orders on appeal except the order dismissing the claims concerning successor liability, which is vacated and remanded for further consideration.
REAL ESTATE MORTGAGE FORECLOSURE RES JUDICATA
34-2-8422 GMAC Mortgage LLC v. Fraser, App. Div. (per curiam) (12 pp.) Defendants appeal the grant of plaintiff's motion for summary judgment in this mortgage foreclosure action which was entered on the basis of the doctrine of res judicata, and the denial of their motion for reconsideration. The panel holds that the motion court was correct in applying the doctrine of res judicata to bar defendants' illegality and unenforceability defenses in light of the decision in a prior related declaratory judgment action holding that despite the fact that Zurich Mortgage Solutions, from which defendants obtained their mortgage, was not a licensed financial entity in New Jersey, the mortgage and notes are enforceable. It rejects the remainder of defendants' arguments, finding their allegations in support of reconsideration to be without merit because they rest on assertions that lack support in the record.
FEDERAL COURT CASES
11-7-8423 Liepe v. Liepe, U. S. Dist. Ct. (Kugler, U.S.D.J.) (6 pp.) Plaintiff David Liepe, an American citizen, and plaintiff Joo-Yeon Liepe, a South Korean national, who married in South Korea, filed this breach of contract action, alleging that defendant Arnold Liepe, David's father, has failed to provide adequate financial support for Joo-Yeon, as required by the I-864(a) form he allegedly signed as a prerequisite for her being admitted to the United States. The court construes all four of plaintiffs' motions as one for summary judgment and denies the motion because they have not yet established that the parties have a binding contract and that defendant has an ongoing financial obligation to Joo-Yeon where, among other things, they have submitted only part of the I-864(a) form which itself is incomplete because it lacks defendant's signature. [Filed December 10, 2012]
DAMAGES AND REMEDIES PREJUDGMENT INTEREST TORTS
60-7-8424 Salvatore v. Viking Sport Cruisers Inc., U. S. Dist. Ct. (Hillman, U.S.D.J.) (6 pp.) Plaintiff moves to alter the judgment entered in this matter to include an award of prejudgment interest. Noting that defendant did not file opposition to the motion and that the time for filing opposition has expired, and that federal courts sitting in diversity must apply state law with respect to prejudgment interest, the court awards prejudgment interest calculated pursuant to New Jersey Rule of Court 4:42-11(b).
GOVERNMENT POLICE TORTS
21-7-8425 Smith v. Grandsen, U. S. Dist. Ct. (Irenas, S.U.S.D.J.) (9 pp.) After the jury returned a verdict of no cause for defendant- police officers Gransden and Frampton in this action alleging that police deprived the deceased of his constitutional right not to be subjected to excessive force and deliberate indifference to his medical needs, plaintiff, the deceased's mother, renews her motion for judgment as a matter of law or, in the alternative, a new trial, solely with respect to Frampton, who was the supervisor at the scene where Gransden shot the deceased. The panel denies the motion because, on the evidence presented, the jury reasonably could have found that Frampton's actions did not cause any harm to the deceased and that he was not deliberately indifferent given the chaos and activity at the scene. [Filed December 10, 2012]
48-7-8426 McHale v. Kelly, Dist. Ct. (Kugler, U.S.D.J.) (4 pp.) Plaintiffs Robert and Delilah McHale brought suit against their former attorney Defendant Ralph Kelly, alleging fraud, professional negligence, and breach of fiduciary duty arising out of Defendants representation of Plaintiffs after Robert suffered personal injuries in a motor vehicle accident. Plaintiffs first suit against Defendant asserting similar claims was dismissed by the Court for failure to state a claim upon which relief can be granted. As part of this subsequent suit, the Court now considers Plaintiffs motion to have the Court recuse itself pursuant to 28 U.S.C. § 144 (2006). Because Plaintiffs have failed to present a sufficient affidavit to support their motion for recusal, their motion is denied.
24-7-8427 East Coast Building Services, LLC v. Marco Contractors, Inc., Dist. Ct. (Cooper, U.S.D.J.) (5 pp.) Plaintiff East Coast Building Services, LLC (ECBS) brought this action against defendant Marco Contractors, Inc. alleging claims for breach of contract, quasi-contract, and promissory estoppel. ECBS asserts that it is a New Jersey limited liability company, organized and existing under the laws of the State of New Jersey, with its principal place of business located at 210 Broad Street in the City of Red Bank, County of Monmouth, and State of New Jersey. But it fails to properly allege its citizenship. Thus it has failed to demonstrate that there was complete diversity of citizenship when the action was commenced; it has failed to demonstrate that it is a citizen of a different state in relation to Marco. The Court dismisses the complaint without prejudice to ECBS to either recommence the action in state court, as limitations periods are tolled by the filing of a federal complaint; or move in accordance with the Federal Rules of Civil Procedure and the Local Civil Rules to reopen the action in federal court, with documentation that properly demonstrates its own citizenship. [Filed December 6, 2012]
31-7-8428 McHale v. Kelly, Dist. Ct. (Kugler, U.S.D.J.) (10 pp.) This matter arises out of Plaintiffs Robert and Delilah McHales allegations of fraud, aggravated negligence, and breach of fiduciary duty on the part of their former attorney Defendant Ralph Kelly which arose out of their apparent dissatisfaction with the legal services provided following a car accident. Here, the Court grants Defendants motion to dismiss Plaintiffs complaint for failure to state a claim upon which relief can be granted. This is the second case asserting similar claims; the first case was dismissed. The Court finds Plaintiffs cause of action for fraud is barred by the doctrine of res judicata. Plaintiffs causes of action for negligence and breach of fiduciary duty are barred by Pennsylvanias statute of limitations where Plaintiffs have not alleged any new facts in their current complaint that would alter the Courts choice-of-law analysis in the prior case. [Filed December 6, 2012]
REAL ESTATE EMINENT DOMAIN
34-7-8429 Tennessee Gas Pipeline Co. LLC v. 0.561 Acres of Land in Montague Twp., U. S. Dist. Ct. (Martini, U.S.D.J.) (3 pp.) The court, having already recognized plaintiff's eminent domain power to take land in Sussex County owned by defendants as part of building an interstate natural gas pipeline, grants plaintiff's motion for a preliminary injunction allowing it to posses the property before it provides just compensation, finding that: (1) success on the merits is apparent; (2) plaintiff will be irreparably harmed if it cannot access the land in short order as it needs to begin tree cutting immediately to meet its project deadline; and (3) the harm to defendants is merely one of timing; and (4) the public interest favors possession. [Filed December 10, 2012]