A spelling error that led an uninvolved party to be named as a defendant in an auto accident case nearly cost the plaintiffs and their lawyers more than $15,000 in sanctions.

Fortunately for them, an appeals court ruled it was an honest mistake that cannot trigger counsel fees and costs under New Jersey’s Frivolous Litigation Statute.

Appellate Division Judges Susan Reisner and Margaret Hayden also held that the misidentified defendant failed to abide by the safe-harbor provision of Rule 1:4-8(b)(1).

According to the opinion in Moran v. Constantine, plaintiffs Jennifer and Kiara Moran were involved in an auto accident on Aug. 14, 2009. The police report named the driver of the vehicle that hit them, Nicholas Constantine, and the owner of the vehicle, Clear Tone Communications Inc., a company in Staten Island, N.Y.

In the complaint filed in Middlesex County Superior Court almost two years later, the plaintiffs mistakenly dropped the “T” and instead listed as a defendant ClearOne Communications Inc., a company based on Utah.

A Utah attorney retained by ClearOne, who was not identified in the ruling, attempted to contact the Morans’ attorneys at Jersey City’s Anise & Anise, and was told that the attorney who signed the complaint was no longer with the firm. That same day, the Utah attorney wrote a letter to Anise & Anise asking that the complaint against ClearOne be voluntarily dismissed and warned if that did not happen by Nov. 8, 2011, ClearOne would obtain New Jersey counsel and seek litigation costs and attorney fees under the Frivolous Litigation Statute, N.J.S.A. 2A:15-59.1.

On Nov. 8, the case was still pending and ClearOne retained the Newark office of Sedgwick. An attorney there was able to speak to an attorney at Anise & Anise, who agreed that it was likely that ClearOne was the wrong defendant but asked for more time to investigate.

On Nov. 14, 2011, ClearOne filed motions for judgment and sanctions. Anise & Anise attempted to file a voluntary dismissal of the claim against ClearOne, 28 days after the Utah attorney warned that sanctions would be sought.

Superior Court Judge Vincent LeBlon granted ClearOne’s motions, and in January 2012 awared ClearOne counsel fees of $15,107.70 and costs of $412.70, totaling $15,520.40. He said the plaintiffs “had no rational argument for continuing to pursue this claim, and not entering a voluntary dismissal, for almost one month.”

On appeal, Reisner and Hayden said that for a claim to be frivolous, no rational argument can be advanced in its support, it is not supported by any credible evidence, no reasonable person could expect it to be successful and it is “completely untenable.”

“An honest attempt to pursue a perceived, though ill-founded, claim is not considered frivolous,” they said in overturning the sanctions.

They also said ClearOne failed to abide by the safe-harbor rule by not waiting until 28 days had passed between the sending of the notice that the complaint be withdrawn and the filing of the motion for sanctions.

“We agree that plaintiffs could have acted more swiftly in dismissing the complaint when ClearOne notified them of the error,” they said. “The record does not show any unusual or emergency situation or reveal any ongoing harm that would have left ClearOne without a remedy unless the safe harbor period was waived.”

Anise & Anise, formerly of Jersey City, has relocated to Boca Raton, Fla., and calls to the new location were not answered. The attorney listed as the Morans’ attorney, Evan Weiss, says he left that firm more than a year ago and has no clear recollection of the case.

ClearOne’s attorney on the appeal, Shaun Bean of Sedgwick, did not return a call. •