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Daily Decision Service Alert: Vol. 22, No. 92 — May 13, 2013
New Jersey Law Journal
STATE COURT CASES
CIVIL PROCEDURE MOTION PRACTICE
07-2-9928 Capital One Bank (USA) N.A. v. Woodley, App. Div. (per curiam) (4 pp.) Defendant Woodley, n/k/a Sandra Gaskin, appeals the denial of her motion to vacate a default judgment entered in this action. Finding that defendant made a good faith attempt to file a timely answer, counterclaim and third-party complaint, which was likely thwarted by the negligence of her former husband who delivered the papers to the clerk's office but failed to pay the filing fees, that the attempt to file satisfies the excusable neglect requirement of Rule 4:50-1(a), that the record contains a 2008 settlement between the parties that may constitute a meritorious defense, that the motion was filed within days of the entry of default judgment, and that plaintiff's failure to oppose the motion suggests that it did not believe that it would be prejudiced if the motion were granted, the court reverses the denial of Gaskin's motion. The panel affirms the dismissal of the motion to vacate filed by the ex-husband because he has no interest in the matter and no standing to be heard.
10-3-9929 Fulbrook v. May and Members of City Council, Law Div. (Camden County) (Fernandez-Vina, A.J.S.C. ) (20 pp.) In this action challenging an ordinance adopted the City of Camden limiting the hours of operation of certain businesses, the court holds that the ordinance is a valid exercise of police power by the governing body, not a land use ordinance as argued by plaintiffs, and that plaintiffs have failed to establish that it is arbitrary and unreasonable by a clear showing. Rather, the ordinance is reasonably related to the stated purpose of improving the quality of life for residents in residential areas of the city particularly during the late night/early morning hours and decreasing the incidents of crime, and the means selected have a real and substantial relationship to the object sought to be attained and are reasonably calculated to achieve that goal. [Filed April 19, 2013]
11-2-9930 Sun Pharmaceutical Industries, Inc. v. Core Tech Solutions, Inc., App. Div. (per curiam) (52 pp.) Plaintiff Sun Pharmaceutical Industries, Inc., appeals the dismissal of its Chancery Division multi-count amended complaint against defendants Core Tech Solutions, Inc., Dr. Kirti Valia, Kevin Hahnen, and The Hahnen Group, LLC. Plaintiff alleged breach of contract, breach of a letter of intent (LOI), fraud, breach of the LOI's covenant of good faith and fair dealing, promissory estoppel, and unjust enrichment. Plaintiff sought preliminary and permanent injunctive relief as well as a jury trial on some issues. The trial court reasoned that each of plaintiff's claims depended upon whether plaintiff could demonstrate that Core breached its obligation to negotiate in good faith. That determination had to be made in the context of the fact that plaintiff and Core had only executed a LOI, which set out certain terms and conditions that were to be the subject of future negotiations. Plaintiff's primary dispute is with the court's formulation of the definition of good faith in the context of an LOI. The appellate panel affirms, finding the trial judge correctly found that plaintiff did not establish a breach of the obligation to negotiate in good faith.
CREDITORS AND DEBTORS RIGHTS
15-2-9931 Discover Bank v. Palomino, App. Div. (per curiam) (3 pp.) On defendants appeal, the appellate panel affirms an order denying her motion to vacate a final judgment by default entered against her in the amount of $2740.92 plus reasonable attorney fees and costs for purchases made on a credit card. The motion was denied without prejudice. The judge was willing to give defendant the benefit of the doubt that she had established excusable neglect if she were able to proffer a meritorious defense, which she was not compelled to do under the circumstances of this case. The judge noted, however, that defendant merely asserted a general denial that she did not owe the money, which was insufficient to result in an order vacating the default judgment. She advised defendant of her deficiencies and what she needed to present to satisfy her burden to vacate the default judgment. The panel finds no denial of due process.
20-2-9932 Almeida v. Dykhouse, App. Div. (per curiam) (3 pp.) The appellate panel previously remanded this matter, directing the trial court to address specific financial issues disputed by the parties. Defendant appeals from the trial court's decision on remand, arguing that the trial court judge should have granted him a credit of $39 per week from April 2008 to the present for amounts he claims he should not have had to pay for health insurance premiums in the past. The court affirms, finding that the issue that defendant is raising was not within the scope of the carefully limited remand and that there is nothing in the record to indicate that defendant raised the issue before the trial judge on remand and therefore, it is not properly before the panel on appeal.
20-2-9933 Faccone v. Johnston, App. Div. (per curiam) (3 pp.) Defendant appeals the trial judge's ruling requiring that she pay alimony of $250 per week for three years. The panel affirms substantially for the reasons expressed below, finding that the judge carefully considered the alimony factors pursuant to N.J.S.A. 2A:34-23b and made credibility findings, before entering the judgment of divorce.
20-2-9934 Toryk v. Toryk, App. Div. (per curiam) (20 pp.) Defendant appeals the provisions of the parties' judgment of divorce regarding limited duration alimony, child support, equitable distribution and counsel fees. The panel affirms principally for the reasons expressed below. It adds, inter alia, that the trial judge did not abuse his discretion either in relying on the Social Security Administration's determination as constituting prima facie proof that defendant was able to work or in his assessment of the merits of defendant's claim that he was disabled; the judge did not err as a matter of law in characterizing the parties' approximately 10-year marriage as one of short duration and limiting the years during which alimony would be paid and he properly considered all the required facts and made appropriate findings justifying the amount of alimony awarded; and on the facts here, the judge did not err in denying defendant an equitable share of the condominium purchased by plaintiff well before the marriage where defendant's name was never put on the deed and where defendant was awarded a share of the appreciation in value of the residence during the marriage; and the trial judge did not abuse his discretion in awarding plaintiff counsel fees, although she was in a better position to pay them, because of defendant's bad faith in refusing to settle and because of discovery violations.
LABOR AND EMPLOYMENT
25-2-9935 Nugent v. State of New Jersey, App. Div. (per curiam) (30 pp.) Plaintiff appeals from orders granting summary judgment to defendants State of New Jersey, Department of Corrections (DOC), George Hayman, and James Wojtowicz. Defendants cross-appeal from an order declaring plaintiff to be a dual employee of defendant The Gateway Foundation, Inc. and the State. For purposes of this appeal, the appellate panel assumes that plaintiff was a dual employee. After he was discharged from Gateway, plaintiff filed a complaint alleging violation of his constitutional rights to future employment; violation of the New Jersey Civil Rights Act; intentional interference with economic advantage; defamation; a claim under the New Jersey Tort Claims Act; and wrongful termination premised on the Conscientious Employee Protection Act. The panel affirms on the appeal and deems the cross-appeal to be moot. The panel rejects plaintiff's primary argument that because defendants never provided him with the reason for his ban from DOC facilities, or an opportunity to challenge that decision, his constitutional rights were violated and he is entitled to a post-termination hearing. There is no credible evidence in the record to suggest that the DOC somehow tarnished plaintiff's name, reputation, honor, or integrity, other than simply barring him from entering the premises in light of what could reasonably be concluded to be a security threat whereby a substance abuse counselor might be assisting inmates in changing information that could lead to early release or less punishment.
LAND USE AND PLANNING
26-2-9936 In The Matter Of New Jersey Department Of Environmental Protection Conditional Highlands Applicability Determination, Program Interest No. 435434, App. Div. (per curiam) (20 pp.) Friends of Fairmount Historic District (FFHD) appeals from a final agency decision of the Department of Environmental Protection (DEP). This is FFHD's second challenge to the construction of an electrical substation by Jersey Central Power & Light in Tewksbury Township. The substation was built to address repeated power outages in Tewksbury caused by an increased demand for electricity. In this appeal, FFHD argues that the substation was not merely a "routine upgrade" of a public utility system within the meaning of the Highlands Act and that the project is not consistent with the goals and purposes of the Act. In the alternative, FFHD argues that the decision was arbitrary, capricious and unreasonable. The appellate panel rejects FFHD argument that DEP erred as a matter of law in determining that N.J.S.A. 13:20-28(a)(11) (Exemption #11) applied to the substation project. Regulations applicable to the statutory exemptions were adopted by the DEP, which did not intend to delegate that function to the Highlands Council. The Council exceeded its mandate in issuing a "recommendation" that the exemption did not apply. DEP was not required to defer to that recommendation in the face of countervailing evidence that established the applicability of the exemption.
LAND USE AND PLANNING
26-1-9937 Northgate Condominium Association Inc. v. Borough of Hillsdale Planning Board, Sup. Ct. (Hoens, J.) (41 pp.) The developers notice of public hearings, although using lot numbers that were not included on the official tax map, did not thereby misidentify the lot to be developed, complied with the provisions of the Municipal Land Use Law, and conferred jurisdiction on the planning board. Plaintiff fails to point to anything in the record supporting its claim that the project design of the internal roadway did not comply with density requirements under the Residential Site Improvement Standards.
35-2-9938 Kant Associates v. Township of Jefferson, App. Div. (per curiam) (11 pp.) Plaintiff appeals from the involuntary dismissal of two tax court complaints challenging the denial of farmland assessment of its property in 2007 and 2008. The panel affirms, finding that the burden was on plaintiff to show that it had an approved woodland management plan two years prior to the year for which farmland assessment was sought and that it had failed to make such a showing.
35-5-9939 Nervegna v. Township of East Brunswick, Tax Ct. (Sundar, J.T.C.) (8 pp.) Defendant Township of East Brunswick contends that Plaintiffs failure to appear and provide valuation evidence prior to, and at the scheduled hearing, prompted dismissal of their petition by the Middlesex County Board of Taxation and therefore the Tax Court lacks jurisdiction to entertain an appeal. Plaintiffs argue that their counsels appearance on the scheduled date with valuation evidence and intention to call the assessor as a witness precludes dismissal for lack of prosecution. The court finds that because Plaintiffs counsel appeared and was denied the opportunity to proffer the assessors testimony, the dismissal was improper. The Townships insistence that Plaintiffs accompany their counsel and appear or risk dismissal is unsupported. The Townships motion to dismiss Plaintiffs Tax Court complaint is denied.
36-2-9940 Handley v. Chase Bank U.S.A., N.A., App. Div. (per curiam) (14 pp.) Plaintiff Handley appeals from the Law Division's order that (1) vacated the entry of default against defendants Chase Bank U.S.A., N.A. and Reed Smith, LLP, and (2) dismissed her complaint with prejudice. This appeal has its genesis in Handley's August 2005 Law Division complaint against Chase and Citibank, N.A., which sought tort remedies for violations of the federal Truth in Lending Act (TILA) and the New Jersey Consumer Fraud Act (NJCFA). Defendants removed the case to the District Court, depriving the Law Division of jurisdiction. Chase was represented by Reed Smith in the federal proceeding, which successfully moved to compel arbitration. An order and award was issued in the arbitration, which dismissed Handley's claims and awarded Chase $19,925.41 on its counterclaim. Not only is state court jurisdiction absent here because of the statutory removal and lack of remand of her civil action, but plaintiffs claims are subject to preclusion under the principle of res judicata. The appellate panel rejects Handleys attempt to avoid the consequences of res judicata by arguing that she was deprived of due process of law, finding she received all the process she was due.
FEDERAL COURT CASES
54-8-9941 Cajeira v. Skrunda Navigation, Third Cir. (McKee, C.J.) (5 pp.) Plaintiff, an employee of Kinder Morgan Inc., appeals the District Court's grant of summary judgment dismissing this action filed pursuant to the Longshore and Harbor Workers' Compensation Act after he was injured when the crane line that had been lowering a hose line that had been used to offload petroleum from a ship owned by defendant Skrunda to KMI, jerked upward, lifting the hose and knocking him into the water. The Third Circuit affirms, finding that plaintiff failed to show that the ship's crew failed or was otherwise negligent in carrying out the orders of the hose crew and he thus failed to meet his burden of establishing a genuine issue of material regarding whether Skrunda had an active control duty. [Filed April 23, 2013]
42-6-9942 In re U.S. Mortgage Corp. & CU National Mortgage Inc., U. S. Bankruptcy Ct. (Gambardella, U.S.B.J.) (65 pp.) U.S. Mortgage, a licensed mortgage banker that originated and brokered residential mortgage loans to the public, and CU National, its wholly owned subsidiary, which had brokerage accounts with defendants Vining Sparks and Newbridge Securities, filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code. The trustee, who alleged that the debtors were the alter egos of Michael McGrath, their president and controlling shareholder who later pled guilty to criminal charges alleging a criminal conspiracy that caused more than $100 million in losses, filed adversary complaints alleging that Vining and Newbridge were aware of and knowingly assisted in the various schemes McGrath perpetuated and seeking to avoid transfers made within one year of the petition date and for damages. The court here grants in part and denies in part defendants' separate motions to dismiss the adversary complaints. [Filed April 23, 2013]
42-6-9943 In re U.S. Mortgage Corp. & CU National Mortgage Inc., U. S. Bankruptcy Ct. (Gambardella, U.S.B.J.) (59 pp.) U.S. Mortgage, a licensed mortgage banker that originated and brokered residential mortgage loans to the public, and CU National, its wholly owned subsidiary, which had brokerage accounts with defendant J.P. Turner & Co. LLC, filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code. The trustee, who alleged that the debtors were the alter egos of Michael McGrath, their president and controlling shareholder who later pled guilty to criminal charges alleging a criminal conspiracy that caused more than $100 million in losses, filed an adversary complaint alleging that J.P. Turner was aware of and knowingly assisted in the various schemes McGrath perpetuated and seeking to avoid transfers made within one year of the petition date and for damages. The court here grants in part and denies in part J.P. Turner's motion to dismiss the second amended complaint and denies its motion for summary judgment. The trustee's motion for entry of an order authorizing him to file a second amended complaint is granted. [Filed April 23, 2013]
10-8-9944 National Amusements v. The Borough of Palmyra, Third Circuit (Fuentes, U.S.C.J.) (12 pp.) In 2008, the Borough of Palmyra ordered closed for five months an open-air flea market, owned and operated by National Amusements, Inc. (NAI), due to safety concerns posed by unexploded munitions left behind when the site was used as a weapons-testing facility for the Army. NAI filed the instant action alleging that Palmyras action violated its constitutional rights under 42 U.S.C. § 1983 and New Jersey law. NAI filed a motion for a preliminary injunction requesting that the emergency closure order be lifted. Because the parties agreed pursuant to a Consent Order that the market could resume operations subject to strict safety precautions, that motion was never decided. Thereafter, the District Court granted Palmyras motion for summary judgment and dismissed the action. Nonetheless, NAI declared victory on its § 1983 claims based on the Consent Order, and sought attorney fees pursuant to 42 U.S.C. § 1988. The District Court denied the motion. NAI appeals the order granting summary judgment and the order denying fees. The circuit panel finds summary judgment was properly granted on NAIs procedural due process claim and takings claim. Further, the Boards action was not arbitrary, capricious or unreasonable under New Jersey law. Finally, because the District Court ultimately denied NAIs § 1983 claims on the merits, the District Court properly denied NAIs claim for attorney fees. A party may not recover attorneys fees under § 1988 for interim relief when a district court ultimately dismisses the partys § 1983 claims on the merits. [Filed May 9, 2013]
34-27-9945 Rogers v. Morrice, U.S. Dist. Ct. (Simandle, U.S.D.J.) (18 pp.) Plaintiff, representing herself and proceeding in forma pauperis, alleges that Plaintiff and her late husband were victims of fraud related to a foreclosure on their New Jersey residence. Plaintiff moves to amend her complaint, even though the Court has not completed screening Plaintiffs complaint as required by 28 U.S.C. § 1915(e). Plaintiffs motion is granted and the Court screens Plaintiffs Amended Complaint. Plaintiffs Amended Complaint and accompanying exhibits are hundreds, if not more than one thousand pages long, and the method by which Plaintiff incorporates the entirety of the Amended Complaint by reference into each individual count makes it difficult for the Court, and for potential Defendants, to identify exactly what wrongdoing has been alleged against each Defendant in a manner causing Plaintiffs financial harm. It is not clear to the Court what specific conduct of each Defendant grounds liability for fraud or conspiracy. References to other investigations and lawsuits pertaining to the foreclosure industry generally do not constitute clear averments of fact. The fraud and civil RICO claims are subject to demanding pleading standards which Plaintiff failed to meet. The Court dismisses the claims without prejudice, and offers Plaintiff a final opportunity to file a Second Amended Complaint. [Filed April 23, 2013]
36-7-9946 Harrison v. Trump Plaza Hotel & Casino, U. S. Dist. Ct. (Kugler, U.S.D.J.) (4 pp.) In this action asserting claims for negligence and wrongful death, a survival action, and violation of the Licensed Alcoholic Beverage Server Fair Liability Act, plaintiff moves for default judgment against defendants Adam Good LLC and Firewaters. Those defendants move for an extension of time to answer, move or otherwise reply to the amended complaint. Finding that where defendants' motion was filed three weeks after the due date for responsive pleadings, the delay will have little impact on the judicial proceedings, given that there are multiple defendants who did timely file responses; thus, the civil action as a whole has proceeded meaningfully. For similar reasons, granting defendants motion would not prejudice plaintiffs, and while the explanation for the delay, clerical error and administrative confound, is opaque and not particularly compelling, defendants filed their motion for extension of time immediately after counsel entered an appearance on their behalf and thus it appears that they are acting in good faith. The court therefore finds that defendants' failure to timely respond was due to excusable neglect and it grants defendants' motion and denies plaintiff's motion for default judgment. [Filed April 23, 2013]