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Vol. 15 No. 4 – Top 21 Alerts ANTITRUST – PHYSICIANS 59-3-4975 D’Arrigo v. The South Jersey Hospital System et al, Law Div., (McDonnell, P.J.Cv.)(15 pp.) In this action alleging that defendants engaged in concerted actions under the New Jersey Antitrust Act to suspend plaintiff’s staff privileges in order to drive him out of practice and misappropriate his patients, the court declines to apply the charitable immunity exemption of N.J.S.A. 56:9-5(B)(5) in light of uncertainty over its scope. It determines that the authorized activity exemption, 56:9-5(c), does not apply to the allegedly unlawful activities of the hospital. The hospital cannot engage in a conspiracy with its staff, but the individual staff members are capable of conspiring among themselves. Plaintiff has not shown the concerted action element of a restraint of trade claim under 56:9-3. The 56:9-3 claims are dismissed as to all defendants. However, there is a genuine issue of material fact which precludes summary judgment on the monopolization claim under 56:9-4, and the hospital’s motion for summary judgment on this claim is denied. [decision decided Aug. 25, 2006] ARBITRATION AND MEDIATION 03-2-4954 Kimm v. Blisset et al., LLC, App. Div. (Hoens, J.A.D.) (32 pp.) In the context of a dispute regarding legal fees claimed to be owing for prior legal work and for the dispute itself, where the parties orally agreed to binding arbitration but did not grant the arbitrator any particular authority, the court defines the scope of an arbitrator’s powers; draws distinctions among arbitrations involving fee disputes between attorneys and their clients, arbitrations conducted in court-annexed proceedings, and arbitrations undertaken pursuant to private agreements. It also analyzes the meaning of the recently enacted New Jersey Arbitration Act, N.J.S.A. 2A:23B-1 to -32 as it relates to the powers of an arbitrator. [Approved for publication Aug. 28, 2006.] ATTORNEY/CLIENT-MALPRACTICE 04-4-5402 Kaye v. Rosefielde, Chancery Div. � Atlantic Cty. (Perskie, J.S.C.) (27 pp.) The unauthorized practice of law by an out-of-state lawyer who is chief operating officer and general counsel of a New Jersey entity, without any allegations of reliance, detriment or misrepresentation, does not constitute a severable and discrete cause of action. [Relevant portion of transcript of hearing of May 26, 2006]. CIVIL PROCEDURE – ADDITIONAL DISCOVERY AFTER REINSTATEMENT OF COMPLAINT 07-3-5195 Sprankle v. Adamar of N.J., Inc., etc., et al.,Law Div.-Atlantic Cy. (Todd, Sr., J.S.C.) (7 pp.) In this personal injury action involving discovery issues which are a matter of first impression – specifically, the standard for additional discovery after a complaint is dismissed pursuant to R. 4:23-5(a)(1) and is later reinstated pursuant to R. 4:23-5(a)(2) after the discovery end-date � the court establishes an “exceptional circumstances” standard for the delinquent party, and a “good cause” standard for the non-delinquent party. [Decision dated Jan. 5, 2005.][Approved for publication Sept. 22, 2006.] CIVIL PROCEDURE � LATE EXPERT REPORTS � BEST PRACTICES � SUBSTANTIAL JUSTICE 07-2-2757 Miller v. Lambert, III,App. Div. (Weissbard, J.A.D.) (3 pp.) The appellate court grants plaintiff leave to appeal and summarily reverses the trial judge’s refusal to accept an expert report filed just before a legal malpractice trial date, too late to meet “Best Practices” guidelines. While appreciating the dilemma for the trial judge, the appellate court notes that the “Best Practices” rules were not designed to do away with substantial justice on the merits or to preclude rule relaxation when necessary to secure a just determination. [Decision on motion for leave to appeal, dated Jan. 12, 2006.] CORPORATIONS – DERIVATIVE SHAREHOLDER ACTIONS � FEE-SHIFTING 12-4-5017 Ryan, et al. v. Beatty, et al.,Chancery Div.-Monmouth Cy. (Lehrer, P.J.Ch.) (19 pp.) The plaintiffs-minority shareholders challenged a plan for a 20-to-1 stock split which they asserted had no legitimate corporate purpose, but created the potential for abuse to benefit the majority shareholders. After the case settled on the first day of trial, with the defendants agreeing, inter alia, to abandon the stock split, the plaintiffs sought $600,000 in legal fees for their essentially complete victory. While the judge sympathizes, and finds the fee justified, considering the attorneys’ work and the result obtained, he feels compelled to deny the application, finding that the fee-shifting rule, R. 4:42-9, does not allow for fees in such a case. [Transcript of decision dated Aug. 25, 2006.] ENVIRONMENT – CLEAN-UP COSTS 17-8-4971 E.I. Dupont de Nemours and Co. v. United States of America et al, Third Circuit(Ambro, U.S.C.J.)(93 pp.) Because appellants, owners and operators of industrial facilities throughout the United States that are contaminated with hazardous waste, are themselves partly responsible for the contamination and their cleanups were voluntary, they may not seek contribution from other potentially responsible parties, including the government, under the Comprehensive Environmental Response, Compensation, and Liability Act. Notwithstanding Cooper Industries, Inc. v. Aviall Services, Inc., the court declines to reconsider New Castle County v. Halliburton NUS Corp.and Matter of Reading Co. [filed Aug. 29, 2006][precedential] INSURANCE – CERTIFICATES OF INSURANCE 23-3-3931 Cvetkovic v. New Jersey Water Supply Authority et al, Law Division (Riva, J.S.C.) In this personal injury action, where defendant-third party plaintiff is seeking indemnification from the insurer of another third-party defendant, based on a certificate of insurance provided by the named insured’s broker, the court holds that where the party seeking coverage is not a named insured on the policy, and the insurance certificate expressly states that it is not a binding coverage form, no coverage is conferred. [decision dated Feb. 7, 2006] INSURANCE – CONSTRUCTION CONTRACTS – INDEMNIFICATION 23-2-4976 Englert v. The Home Depot et al, App. Div. (per curiam)(24 pp.) Interpreting the form construction contract between the primary contactor and its subcontractor, the court finds that because it includes two very different indemnification provisions, the contract does not express in unequivocal terms the intention for the subcontractor to indemnify the contractor for its own negligence, and reverses the order requiring the subcontractor to indemnify the contractor for the entire settlement with the plaintiff, who was injured in a construction site accident. The court also considers the policy terms of the Comprehensive General Liability policy issued to the contractor and determines that it provides primary, not excess, coverage. [decision decided Aug. 30, 2006] INSURANCE � GENERAL LIABILITY � CONSTRUCTION 23-2-4876 Firemen’s Ins. Co. of Newark, et al. v. Natl. Union Fire Ins. Co., et al.,App. Div. (Collester, J.A.D.) (23 pp.) The appellate panel holds that defects in construction do not constitute “property damage,” nor are they due to an “occurrence,” in order to trigger coverage under the general liability policy of the developers of condominium projects. [Approved for publication Aug. 16, 2006.] INSURANCE – MOLD DAMAGE – LIMITATIONS 23-7-5035 Twp. of Hamilton v. Zurich American Ins. Co.,U.S. Dist. Ct. (Kugler, U.S.D.J.) (11 pp.) The court grants summary judgment to the defendant insurance carrier in this suit brought by the plaintiff Township, seeking coverage for losses incurred when its Town Hall sustained mold damage. The carrier disclaimed on the basis of a policy exclusion, stating that its expert had found the mold damage to be the result of improperly designed air ducts. Although the declination letter did not inform plaintiff of the one-year limitation on the right to sue, the letter reserved all of defendant’s rights under the policy, which included the limitation. Although the parties engaged in continued discussion and correspondence, the court agrees with defendant that its declination letter met the requirements for a valid declination, triggering the limitations period. [Filed Sept. 5, 2006.] INSURANCE – SNOW REMOVAL CONTRACTORS – INDEMNIFICATION 23-3-5013 Latino, et ux. v. Greg’s Landscaping, Inc., et al., etc.,Law Div. � Hunterdon Cy. (Buchsbaum, J.S.C.) (7 pp.) The plaintiff sued for a slip and fall injury sustained on snow and ice on property owned by defendants Endov and Nexus. Those defendants now move for summary judgment based on contractual indemnification from defendant Greg’s Landscaping, their snow-removal contractor, and the third-party defendant, Farm Family, cross-moves for summary judgment, claiming that Greg’s never purchased insurance from it naming Endov and Nexus. The court denies both summary judgment motions. As to the landowner defendants, the indemnification agreement does not speak to indemnification for their own negligence; and the arbitrator apparently found that the landowner defendants’ own actions made them more responsible for the accident than Greg’s. Defendants would not be entitled to indemnification if it is found that their negligence caused plaintiff’s accident, and such a question is for the jury. As to the insurer, even though Endov and Nexus are not mentioned in Greg’s liability policy, they are mentioned in the liability insurance certificate covering the date of loss, creating a fact question. Under the clause in the contract between Greg and defendants, Greg’s coverage with Farm Family is deemed primary. [Decision dated Aug. 18, 2006.][Released Aug. 24, 2006.] LABOR AND EMPLOYMENT – SEXUAL HARASSMENT 25-2-5203 Fernandez v. Pathmark Stores, Inc., et al.,App. Div. (per curiam) (17 pp.) The trial judge properly entered summary judgment in favor of the defendant-employer on plaintiff’s claim that it failed to adequately investigate and remedy sexual harassment allegedly perpetrated by defendant Flores, a fellow employee with whom plaintiff had had an intimate relationship. The court agrees with the trial judge that Flores’s conduct, while inappropriate, did not amount to sexual harassment, because it was not related to plaintiff’s gender, but to the failed relationship. Moreover, because Flores was not plaintiff’s supervisor, there is no reasonable basis in the record to infer that his offensive conduct was work-related or suggestive of a quid pro quo, as it otherwise might have been viewed if he were plaintiff’s supervisor. Additionally, the trial judge accurately noted that plaintiff did not establish that Flores’s conduct was so severe or pervasive as to cause a reasonable woman to believe that her work environment had been altered. Further, the facts do not support vicarious liability on the part of the employer, where most of the communications were private and personal; most of the offensive incidents took place outside of work hours, although some of them occurred on the property of the employer, such as in the parking lot. Finally, the employer had a firm anti-sexual harassment policy, and took immediate steps once plaintiff complained. LAND USE – REDEVELOPMENT DESIGNATIONS 26-3-4938 Century Land Group, LLC v. Mayor and Council of the Borough of Keyport et al, Law Div. (Lehrer, P.J.Ch.)(36 pp.) The Legislature did not limit the application of the Redevelopment Law, N.J.S.A. 40A:12A-1 et seq., solely to those properties that are not likely to be privately developed. The law authorizes designation of an area as in need of redevelopment if any of the eight conditions enumerated in N.J.S.A. 40A:12A-5 are met. Since the subject property clearly meets several of those criteria, the municipality has followed the appropriate procedures in making the designation, there are clear factors to justify soliciting proposals from many developers, and plaintiff-contract purchaser of the property has not tendered any evidence that rebuts substantial evidence in support of the redevelopment designation, the actions of the municipality in so designating the property were not arbitrary, capricious, or ultra vires. Moreover, plaintiff has no standing to raise a breach of contract claim since it has not yet sustained damage. [decision dated Aug. 22, 2006] LAND USE – USE VARIANCES 26-3-4989 A & B Holdings, L.L.C. v. Zoning Bd. of Adj. of the Borough of Manville, Law Div. (Buchsbaum, J.S.C.)(9 pp.) In this action in which the court previously reversed the Board of Adjustment’s refusal to grant a use variance to permit residential lots on the proposed site in the industrial zone, but remanded for a determination as to whether the requested subdivision to create two new residential lots should be granted, the court finds that because the board failed to make any findings of fact in its resolution granting only one new lot, and simply rejected the testimony of the applicant’s experts that two lots would not negatively impact flooding, municipal services, or have a negative impact on the zone plan, without giving any reason therefore, the board’s decision creating only one new lot is reversed and the subdivision creating two new lots is granted. [decision decided Aug. 28, 2006] MUNICIPAL LAW – TREE REMOVAL AND PROTECTION ORDINANCES 30-3-5071 Park Ridge Estates, L.L.C. v. Twp. of Cedar Grove,Law Div.-Essex Cy. (Goldman, J.S.C.) (40 pp.) The court finds the defendant municipality’s “Tree Removal and Protection Ordinance” invalid as written, and violative of due process because many of its key provisions bear no rational relationship to its goals and purposes, particularly as to the mitigation or replacement fee, and the determination of where, how many, and when off-site trees are planted. It violates equal protection because of the irrational exemption for one- and two-family homes, not based on any environmental factor reasonably related to the ecology of trees. Finally, the fees charged, particularly for the mitigation or replacement fees, constitute an unauthorized and illegal tax, far beyond any demonstrated cost of administration. While there is no question about the ability of a municipality to have an ordinance protecting its trees, the objection here is to the content of the ordinance. Therefore, the court stays the determination of invalidity to allow the municipality to correct the cited defects. [Decision dated Sept. 11, 2006.][Released Sept. 11, 2006.] NEGLIGENCE – DUTY OF ROADSIDE STORES TO PROTECT CUSTOMERS FROM OUT-OF-CONTROL VEHICLES ON ROADWAY 31-3-5072 Fabie, et al. v. Santaglia, et al.; Willick, et al. v. Ford Motor Co., et al.,Law Div.-Essex Cy. (Contillo, J.S.C.) (19 pp.) The plaintiff’s decedent was seated at a table, working on his computer inside a Starbucks coffee shop on Route 4 in Englewood, when he was struck and fatally injured by an out-of-control vehicle, which careened off the roadway and crashed through the storefront. In this opinion, the court grants summary judgment to Starbucks, holding that it had no legal duty under the circumstances presented to protect its customers from out-of-control vehicles entering from the highway. [Decision dated May 17, 2005.] NEGLIGENCE – ENGINEERING SERVICES – AFFIDAVIT OF MERIT – EXPERT’S QUALIFICATIONS 31-7-5261 Two Rivers Water Reclamation Authority v. Camp, Dresser & McKee, Inc., et al.,U.S. Dist. Ct. (Wolfson, U.S.D.J.) (8 pp.) The plaintiff, a public body and corporation organized under the provisions of the Sewerage Authorities Act, alleged negligence, breach of contract and professional malpractice in connection with engineering services defendant provided as part of the plaintiff’s efforts to expand and upgrade its wastewater treatment facilities and pumping facilities. The court denies defendant’s motion for partial summary judgment, rejecting its claim that plaintiff’s expert lacks the statutorily-mandated qualifications to author an affidavit of merit in support of plaintiff’s malpractice claims related to the design of certain odor control and biofiltration mechanisms. While defendant argues that the claims at issue involve a discrete and specialized practice area within the engineering profession, requiring board certification, plaintiff’s expert asserts there is no such specialty, and no such “board;” in fact, defendant offers no support for its argument other than counsel’s bald assertions. As the New Jersey Supreme Court has recognized that there are overlaps in the practice of the medical profession, there are likewise overlaps in the practice of engineering. The court finds that the expert’s extensive experience in the areas of wastewater engineering and treatment are sufficient to qualify him to provide the required basis for the plaintiff’s malpractice claim. [Filed Oct. 3, 2006.] REAL ESTATE – DEEDS – UNDUE INFLUENCE � ESTATES 34-2-5085 I/M/O Estate of Green, etc.,App. Div. (per curiam) (14 pp.) The Chancery Court, Probate Part, justifiably declared a 1986 deed to appellant from her deceased mother, as well as the appellant’s subsequent transfer of the subject property, null and void due to undue influence. The property was ordered to be sold, and the net proceeds distributed to the decedent’s living children or their next of kin, following reimbursement of taxes paid by the appellant. REAL ESTATE – ENVIRONMENTAL ISSUES – SPILL ACT – TRANSFER TO D.E.P. 34-4-5044 Forsgate Industrial Complex, L.P. v. Leggett & Platt, Inc., etc., et al.,Chancery Div. � Bergen Cy. (Doyne, J.S.C.) (10 pp.) Plaintiff, alleging that its property was contaminated by a groundwater plume emanating from the defendants’ property, sought remediation pursuant to the Spill Act. Although defendant had procured a “No Further Action” letter from the DEP, the plaintiff’s amended complaint alleges contamination at various other sites owned by the plaintiff, but not the subject of the NFA letter. Further, the NFA letter explicitly notes that issuance of the same by the DEP does not affect the rights of third parties, such as the plaintiff, pursuant to the Spill Act. The court denies defendants’ motion to dismiss with prejudice, being satisfied that there are material, factual disputes, including whether there are environmental contaminants on plaintiff’s property and, if so, the nature and extent of the same; the source of the contaminants; defendant’s culpability, if any, for the presence of such contamination; and the nature and scope of the remediation which may be required should it be demonstrated the defendant is the cause of an unacceptable level of contamination. Further, a determination will have to be made as to the presence of purported contaminants on properties not otherwise addressed by the NFA letters. However, the court grants defendants’ application to dismiss without prejudice and to require referral of the matter to the DEP, concluding that such a course would be appropriate given the DEP’s extensive history with the property, its technical expertise, and to attempt to ensure the application of uniform standards to be applied equally to all similarly situated New Jersey properties. Nothing herein precludes the plaintiff’s resort to State courts should the DEP refuse to intercede. [Decision dated Sept. 8, 2006.][Released Sept. 8, 2006.] WILLS, ESTATES AND TRUSTS � WILL AND TRUST INTERPRETATION 38-4-3991 I/M/O Estate of Reininger, Deceased,Chancery Div. � Union Cy. (Lyons, P.J.Ch.) (15 pp.) This case addresses: (1) when a remainder vests; (2) the prerequisites for the application of the doctrine of probable intent; and (3) the proofs needed to prevail in a probable intent contest. [Decision dated May 18, 2006.][Released May 24, 2006.] ***Advertisement*** Publisher’s Note:Most firms subscribing to the Alert have now installed the free Daily Decision Service electronic archive. Gain an advantage in every legal research project by uncovering unpublished decisional law. Call MaryBeth Cole at (973) 854-2933, with any questions. *** Advertisement *** The Law Journal’s Annual Review of New Jersey Civil Case Law 2007 By Seton Hall Law School Professors Paula Franzese and Denis McLaughlin Get up to speed on 120 state court appellate opinions decided during the past year, delivered by outstanding teachers in just three hours. To register or for more information, go to njlj.com or call Rose Traynham at (973) 854-2945

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