Opinion
DOCKET NO. A-4531-13T2
08-18-2016
ALICE BOSWELL, RUTH BELTHOFF, and CHARLOTTE GANN, Plaintiffs-Respondents/Cross-Appellants, v. PRICE MEESE SHULMAN & D'ARMINIO, P.C., GAIL L. PRICE, ESQ. and PAUL A. CONCIATORI, ESQ., Defendants-Appellants/Cross-Respondents.
Shaji M. Eapen argued the cause for appellants/cross-respondents (Morgan Melhuish Abrutyn, attorneys; Elliott Abrutyn, of counsel and on the briefs; Mr. Eapen, on the briefs). Edward R. Grossi argued the cause for respondents/cross-appellants.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Yannotti, St. John and Guadagno. On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-5334-11. Shaji M. Eapen argued the cause for appellants/cross-respondents (Morgan Melhuish Abrutyn, attorneys; Elliott Abrutyn, of counsel and on the briefs; Mr. Eapen, on the briefs). Edward R. Grossi argued the cause for respondents/cross-appellants. PER CURIAM
Defendants Price Meese Shulman & D'Arminio, P.C. (Price Meese), and Price Meese attorneys Gail L. Price and Paul A. Conciatori, challenge the trial court's refusal to hold, as a matter of law, that plaintiffs Alice Boswell, Ruth Belthoff, and Charlotte Gann, had waived any conflict of interest, and otherwise contest liability and the court's various determinations that allowed this legal malpractice matter to proceed to judgment. Plaintiffs, in their cross-appeal, contend that the court erred in dismissing their punitive damage claims, and, in connection with such dismissal, barring evidence, limiting discovery, and denying additional counsel fees. Having reviewed the arguments in light of the record and applicable law, we affirm on the appeal and cross-appeal.
I.
The following facts and procedural history are gleaned from the record. In 1955, Charles and Ida Sohn and Thomas and Kathryn Murphy leased a 2.77-acre tract along Route 17 in Paramus, commonly referred to as Lot 2, to Grand Union. The initial term was until 1977, with Grand Union having the option, upon proper notice, to renew for up to five consecutive ten-year terms. It also had the option to purchase the property for $142,500. Lot 2 was primarily used for parking; the adjacent property, known as Lot 4, was owned by Grand Union, and developed into a strip mall, with Grand Union and eventually K-Mart in the two larger end buildings, and several smaller retailers between them.
Plaintiffs Alice Boswell and Ruth Belthoff are the Murphys' daughters, and plaintiff Charlotte Gann is the Sohns' granddaughter.
In October 1976, Grand Union proposed to the lessors that the lease be amended so that, unless it gave 270 days' advance notice of termination, the term would renew automatically. Grand Union requested that the lessors return countersigned copies indicating their agreement (1976 amendment). It received countersigned letters from Boswell, signing under a power of attorney for Kathryn Holmes, and from Charles Sohn. Notwithstanding the 1976 amendment, on December 29, 1976, Grand Union also expressly exercised in writing its option for a ten-year renewal in a letter to Sohn.
In July 1979, Grand Union assigned the lease to K-Mart. Grand Union and K-Mart also executed a separate sublease agreement by which Grand Union became the sub-lessee for its store and the other retail stores, retained non-exclusive rights to common areas on Lot 4, and retained non-exclusive parking rights on Lot 2. K-Mart assigned back to Grand Union the option to purchase. The sublease was renewable in five-year terms.
In May 1987, K-Mart notified Charles and Ida Sohn in writing that it was exercising its option for another ten-year renewal. In April 1997, K-Mart sent another ten-year renewal notice, this time mailing it to the Kathryn Holmes Trust, of which Alice Boswell and Ruth Belthoff were trustees, and to Gann. In 1993 and 1999, Grand Union renewed its sublease with K-Mart.
By then, Belthoff and Boswell together were fifty percent fee owners, while Gann owned the other fifty percent.
In 2001, Grand Union filed for bankruptcy, and Stop & Shop purchased some of its assets, including Lot 4. On March 4, 2001, Grand Union also assigned its rights under the 1955 lease to Stop & Shop. The purpose of the assignment was to act as a quit claim from Grand Union to Stop & Shop of rights Grand Union had in the fee and the leasehold. The property reference, however, mistakenly referred to Lot 4 rather than to Lot 2. Moreover, Lot 4 had already been purchased from Grand Union by Stop & Shop.
On January 28, 2005, Stop & Shop and K-Mart executed an amended agreement by which Stop & Shop became the master lessor of both Lots 4 and 2, and K-Mart became lessee only of its building and pad (first amendment to indenture). It was not until July 25, 2005, that Stop & Shop proposed to K-Mart a form of assignment of the lease, which the parties eventually executed in April 2006, and by which K-Mart's rights under the 1955 lease were transferred to Stop & Shop. By its terms, the assignment of lease was made effective retroactive to January 28, 2005.
As early as 2005, Stop & Shop had become interested in expanding its store at the site. It wanted to keep the K-Mart building and raze the existing Stop & Shop and smaller stores in the strip mall, and replace them with a new Stop & Shop and refurbished parking areas. Michael Blazoski, a real estate consultant who had been advising Stop & Shop on finding new locations, negotiating leases, and related matters, had brought to the company's attention the option in the 1955 lease to purchase Lot 2. However, a problem was discovered concerning a subdivision issue: the tract adjacent to Lot 2 and denominated as Lot 1, had not been subdivided and was still part of Lot 2. Until the problem was corrected, Stop & Shop could not proceed with its site plan application to reconfigure the stores.
During summer 2005, Gail Price was contacted concerning the development plans, and was directed to begin work on the necessary approvals. Price recalled it was either in late 2005 or early 2006 when she learned of the subdivision problem. Paul Conciatori had represented Stop & Shop on prior projects, and also became involved in this matter. According to Conciatori, Price informed him at some point in summer 2005 about the subdivision issue, explaining that their engineer had discovered it. Blazoski said that he did not learn of that issue until June 2006 when Price informed him. Notes of a call between Blazoski and Price on June 16, 2006, indicated that the subdivision problem needed to be corrected prior to filing the site plan application for the improvements planned by Stop & Shop.
Moreover, Blazoski's notes from a June 21 meeting with Price and Conciatori mentioned the subdivision problem with Lots 1 and 2, including the option to purchase Lot 2, though Blazoski was uncertain whether they talked in depth about the option. Blazoski acknowledged that they may have discussed the relative merits of exercising the option before getting the subdivision corrected, or going ahead with the subdivision correction first, but in any event, the property could not be transferred before the subdivision issue was corrected.
Price maintained that when she first began work on the site plan application, she was unaware of the option to purchase Lot 2 because the 1955 lease had no bearing on the firm's work on the site plan application. Price stated she first learned of the purchase option sometime between June and September 2006. Beginning in February 2006, however, Price's time records expressly referenced working with Stop & Shop on matters related to the "lease" or "leases" for Lots 1 and 2. An entry from June 14, 2006, indicated that Price called Blazoski "to push call to Lot 1 & 2 owners," presumably about resolving the subdivision issue. Billing records also indicated that as early as February 2006, Conciatori was working on matters related to the lease and the option for Stop & Shop to purchase Lot 2.
In any event, defendants believed that in order to make a proper site plan application, Shop & Stop needed to obtain plaintiffs' consent. Thus, in early July 2006, Blazoski spoke with Belthoff and her husband, and learned details of the current ownership of both lots. He then spoke with Boswell and Gann. Blazoski explained that the subdivision of Lots 1 and 2 had not been done correctly, that Stop & Shop was considering remodeling its store and would need to correct the problem, and that Stop & Shop would undertake the subdivision at no cost to plaintiffs. He also learned that an attorney, Edward Breslin, represented Boswell.
On August 31, 2006, Conciatori sent Breslin copies of the subdivision application documents. Among other things, Conciatori said that, "[a]ssuming the enclosed meets with your approval, kindly arrange for the application to be executed by each of the owners identified therein." As for any potential conflicts of interest, Conciatori indicated the following:
As our office will be representing the property owners solely in connection with this minor subdivision application, we will be forwarding under separate cover a proposed conflict waiver letter to be executed by the property owners in light of our present and continued representation of the Stop & Shop Supermarket Company.
On September 5, 2006, Conciatori sent Breslin two letters: the first, a letter of transmittal addressed to Breslin referring to an enclosed waiver letter to be countersigned by plaintiffs; and a second, the waiver letter addressed to all plaintiffs, dated the following day. In the transmittal letter to Breslin, Conciatori referred to the subdivision issue, to the fact that Stop & Shop had an option to purchase Lot 2, and to Price Meese's future plan to file land use applications for Stop & Shop to construct a new supermarket on Lot 2 and Stop & Shop's adjoining tract:
The waiver letter was also sent to two other parties who only had an interest in Lot 1.
As a follow up to our recent letter forwarding a draft of the Minor Subdivision application for [Lots 1 and 2], enclosed are five (5) original "Conflict Waiver" letters to be executed by each of the individual owners of Lots 1 & 2. Although no conflict exists, and it is in both your clients' interest and Stop & Shop's interest for the 1956 subdivision to be re-confirmed and perfected, we nonetheless thought it prudent for this letter to be executed at this time.
More particularly, Stop & Shop is presently a tenant on Lot 2 and has an option to purchase said lot pursuant to the agreement/lease executed by the parties some time ago. Stop & Shop also presently owns land in fee adjoining the above property. In addition, as you are aware, once this subdivision application is completed, this Firm will be filing land use applications on behalf of Stop & Shop for a new supermarket/retail to be constructed on Lot 2 and the adjoining property owned by Stop & Shop.
Assuming the attached letter meets with your approval, kindly have each of the individual property owners execute the letter and return them to me as soon as possible.
Should you have any questions, please do not hesitate to call.
In the waiver letter, Conciatori outlined the legal services being provided by Price Meese. He indicated that "the scope of our services will be limited to representation of your interest as property owners in connection with the filing of a subdivision application" in order to "re-confirm a subdivision granted by Paramus in 1956." The letter explained that although the prior subdivision had been granted by Paramus, no documentation had ever been filed with Bergen County; and as a result, this application was necessary to remove ambiguities about the existence of Lots 1 and 2. Further, the letter indicated that copies of the application and supporting documents already had been forwarded "to your attorney, Edward Breslin, Esq. Our firm's representation of you in this regard will be at no cost to you."
Conciatori's letter confirmed that Price Meese was representing Stop & Shop, the tenant under the lease on Lot 2 and the owner of Lot 4. Among the related matters in which the firm envisioned continuing to represent Stop & Shop were the filing of land use applications for a new supermarket and related improvements on Lot 2 and Stop & Shop's own adjoining lot. Price Meese's future representation "may also include services related to Stop & Shop's potential purchase of Lot 2 from you, pursuant to the previously executed agreement/lease."
Conciatori then addressed conflicts:
This letter will further confirm that presently no conflict exists which would preclude this Firm from representing you and your interests under the Rules of Professional Conduct of New Jersey because: (1) not only is there no conflict between your interest and Stop & Shop as it relates to the re-confirming of the 1956 subdivision of [Lots 1 and 2], but there is an identity of interests as both you and Stop & Shop will benefit by a current re-confirming of the 1956 subdivision and perfection thereof by recording with the County of Bergen; and (2) you have been and will continue to be independently represented by counsel as to your interests in this matter, as you see fit, by your attorney, Edward Breslin, Esq., and Mr. Breslin has knowledge of your retention of this Firm as outlined in this letter and can advise you accordingly and answer any questions you may have pertaining to this matter.
This letter will further confirm that to the extent an actual conflict may arise in the future as it relates to this Firm's representation of Stop & Shop, we will immediately notify you in writing of our belief of such a conflict. Furthermore, to the extent such potential future conflict is one which can[]not be waived, we will immediately withdraw from further representation of you and expeditiously deliver all files to the attorney you so direct. However, this shall confirm your agreement that our withdrawal from your representation shall not preclude us from continuing to represent Stop & Shop in the matters referenced herein or any other matters. Of course, consistent with the Rules of Professional Conduct of New Jersey, no knowledge or information gained from our representation of you can or will be used to your disadvantage.The letter closed by asking that plaintiffs countersign copies of the letter to confirm their knowledge of and agreement to the matters expressed.
After Breslin received the subdivision documents and the application to be signed by his clients, Conciatori called to talk about the proposed conflict letter, but did not identify any specific conflicts. Breslin testified that he did not advise plaintiffs about signing any waiver because, "well, in the first instance I wasn't sure why I was involved. And in the second instance no one ever asked me to give an opinion regarding the conflict letter."
Breslin did not follow-up with plaintiffs individually to obtain the countersigned letters, since he believed a relative of Boswell's had done as much, and asserted that no plaintiff had ever asked him questions about the waiver letter. He eventually received a copy signed by each of the plaintiffs and forwarded the executed documents to Price Meese.
On October 18, 2006, Conciatori filed the subdivision application for Lots 1 and 2 on plaintiffs' behalf and on behalf of the owners of Lot 1. On January 18, 2007, the Paramus Planning Board approved the subdivision application for Lots 1 and 2, and in March, Conciatori sent Breslin copies of the resolution approving the subdivision. Breslin sent Conciatori the new subdivision deed executed by his clients.
Although not determinative to other events that followed, the subdivision would have to be corrected yet again because during the application process another error had been made concerning the Lot 1 parties.
When the deed was filed in June or July 2007, Conciatori believed the Price Meese representation of plaintiffs had concluded. Conciatori never had any direct communication with any of plaintiffs. Stop & Shop paid Breslin's fee in connection with the subdivision, and Breslin thought the matter had been concluded. Thus, on July 3, 2007, Breslin wrote to Conciatori about receipt of the recorded subdivision deed, adding that he "believe[d] this satisfactorily concludes this matter."
Meanwhile, on April 17, 2007, Stop & Shop sent Sohn and Holmes written notice of its intent to renew the lease for the fourth option period, beginning December 1, 2007. Price acknowledged that by the end of October 2007, she had become aware of Stop & Shop's renewal notice. On May 23, 2007, Sears Holdings, on behalf of K-Mart, sent Gann notice that it was exercising another ten-year lease renewal, through November 17, 2017.
On behalf of Holmes, Stop & Shop also sent the notice to Boswell.
In December 2007, Conciatori contacted Breslin to get plaintiffs' consent for Stop & Shop's site plan application, and Breslin made arrangements to get the documentation to the plaintiffs.
In January 2008, Blazoski advised Stop & Shop to exercise its option to purchase Lot 2. Among other things, Blazoski said that "[t]he individual landlords while presently cooperative, are elderly, and their heirs may not be of a similar attitude." At trial, he denied that he had been suggesting that they move forward at that particular juncture just because "now is your best opportunity given that these three old ladies are going to do basically whatever you asked them to." According to Blazoski, Price and Conciatori were not at the meeting with Stop & Shop representatives where the purchase option was discussed.
On February 11, 2008, Price Meese filed Stop & Shop's preliminary site plan application with Paramus. In the application, Stop & Shop indicated that it was the owner of Lot 4 and the "long-term lessee of Lot 2". All three plaintiffs signed the application as owners of Lot 2, certifying in part that they agreed to be bound by the representations in the application.
Then, on March 3, 2008, while the site plan application was pending, Stop & Shop sent plaintiffs a letter exercising its option to purchase Lot 2 for $142,500. Philip Boggia, an attorney, was contacted by Boswell's son, concerning the planned Stop & Shop purchase, and whether the Lot 2 lease was still valid. At that point Gann lived in Tennessee, and Belthoff was ill. Breslin had also received Stop & Shop's letter purporting to exercise its option to purchase Lot 2, but he did not ask Conciatori for more information and left the matter to Boggia.
On April 3, 2008, Boggia wrote Conciatori that he represented Boswell, but not the other plaintiffs, in connection with the Stop & Shop matter. Conciatori inferred from Boggia's involvement and document request that plaintiffs were searching for a way to demand or negotiate a higher price for Lot 2. After providing Boggia with certain documents, Conciatori requested a prompt closing as per the provisions of the lease.
Eventually Boggia would represent all three plaintiffs.
Discussions broke down, and on June 23, 2009, Stop & Shop filed a complaint signed by Price, against plaintiffs for specific performance of the sale of Lot 2. Plaintiffs informed Stop & Shop they considered it a hold-over, month-to-month tenant having failed to renew the lease, and also that the attempts in the 1970s to alter the means of renewal notice had been ineffective. Plaintiffs contended that the lease terminated on November 30, 2007.
As litigation ensued, Price assumed responsibility for dealing with Boggia. At a point, Boggia asserted that because of the earlier subdivision matter, Price could not represent Stop & Shop against plaintiffs and had to disqualify herself. Both Price and Conciatori denied having reviewed the 1955 lease for substance when they were working on resolving the subdivision issue. When Price refused to withdraw, Boggia moved to have her disqualified. Prior to the motion being decided, Price Meese withdrew, and new counsel was substituted.
On January 25, 2011, the parties reached a settlement, with Stop & Shop paying plaintiffs $2.5 million for title to Lot 2. On June 23, 2011, plaintiffs filed a malpractice complaint against defendants Price Meese and Price. On August 17, 2012, plaintiffs filed an amended complaint, adding Conciatori, and included additional claims for breach of fiduciary duty, fraud, and breach of contract. Plaintiffs alleged that having previously jointly represented both landlord and tenant in connection with a land use application for the leasehold, and subsequently filing on behalf of the tenant a complaint against plaintiffs to enforce the lease's purchase option, defendants had breached their duty and committed other torts.
On March 8, 2013, the court denied plaintiffs' motion to compel discovery of numerous documents defendants had claimed were privileged, concluding that plaintiffs failed to demonstrate that such information was not protected under the attorney-client privilege. On April 19, 2013, it denied plaintiffs' motion for reconsideration.
On December 20, 2013, the court denied defendants' motion for summary judgment, and also denied reconsideration. It also denied, in a written opinion, plaintiffs' motions to reopen discovery, to file a second amended complaint, and to bar defendants' experts.
On February 18, 2014, the court made a number of evidentiary determinations, including the admissibility of the asserted privileged information, expert testimony, and one of plaintiffs' prior statements. The parties tried the case before the judge and a jury beginning in February 2014, and on February 26, 2014, at the close of plaintiffs' case, defendants moved for dismissal. The court granted the motion with respect to all counts except for the professional malpractice claim. Thereafter, the court denied defendants' motion for judgment.
No plaintiff testified: Boswell was barred given her mental incapacity, Belthoff had passed away, and Gann, in poor health, lived in Tennessee.
The jury returned a verdict for plaintiffs, awarding damages of $662,483. On March 26, 2014, the court signed an amended judgment that included interest and counsel fees. On April 25, 2014, the court signed an order denying defendants judgment notwithstanding the verdict, and denying a new trial. On April 30, 2014, the court denied plaintiffs additional counsel fees in connection with defendants' post-trial motions.
Defendants appealed and plaintiffs cross-appealed. We denied plaintiffs' motion to compel defendants to file with the court certain confidential documents, and also denied plaintiffs' motion to consolidate this appeal with Boswell v. Wilson, A-4494-14.
Boswell v. Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, No. A-4494-14 (App. Div. August 18, 2016), a back-to-back opinion of even date, involves plaintiffs' appeal from the grant of summary judgment to these defendants and others regarding allegations of fraudulent concealment in this and an earlier related matter, and a cross-appeal from the denial of frivolous litigation damages.
Defendants argue on appeal that the trial court erred by failing to dismiss on a motion for summary judgment plaintiffs' amended complaint because the limited retainer and waiver of conflict letter was valid, proper, and agreed to by plaintiffs with informed consent, and additionally, plaintiffs were represented by independent counsel. Defendants contend that there was no "concurrent conflict" between plaintiffs' and Stop & Shop's interests respecting the subdivision application, but that even if there were such a conflict, the waiver letter served as a valid estoppel against malpractice claims stemming from the subdivision application, or any subsequent conflicts regarding plaintiffs, because the waiver letter complied with the rules on attorney conflicts.
Defendants further contend the court erred by not granting their motion for reconsideration. Defendants argue the court erred by not dismissing the amended complaint once it did not allow plaintiffs' expert report on the issue of proximate cause and other evidential rulings, and the issue of the entire controversy doctrine. Lastly, defendants assert that the court erred by improperly answering a jury question thereby allowing the jury to decide an issue of law. We disagree.
On April 20, 2015, defendants, pursuant to Motion No. M-6375-14, moved to dismiss/strike a portion of plaintiffs' reply appendix and part of their reply brief. The motion is hereby granted. R. 2:5-4(a). --------
In their cross-appeal, plaintiffs contend that the court erred in dismissing their punitive damage claims and, in connection with such dismissal, barring evidence, limiting discovery and denying them additional counsel fees. Again, we disagree.
II.
We review the entry of summary judgment de novo, applying the same standard as the trial court. Townsend v. Pierre, 221 N.J. 36, 59 (2015). We determine "whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).
"[T]he usual principles of negligence apply to legal malpractice." Conklin v. Hannoch Weisman, 145 N.J. 395, 416 (1996). "The requisite elements of a cause of action for legal malpractice are: (1) the existence of an attorney-client relationship creating a duty of care upon the attorney; (2) the breach of that duty; and (3) proximate causation." Ibid. (citation omitted); accord Jerista v. Murray, 185 N.J. 175, 190-91 (2005); Froom v. Perel, 377 N.J. Super. 298, 310 (App. Div.) ("The existence of an attorney-client relationship is, of course, essential to the assertion of a cause of action for legal malpractice."), certif. denied, 185 N.J. 267 (2005). The client bears the burden of establishing each element of a legal malpractice claim. Sommers v. McKinney, 287 N.J. Super. 1, 10 (App. Div. 1996).
A.
Defendants do not dispute that an attorney-client relationship was established between the parties. The issues in contention are the scope of defendants' representation, the duty owed to the client, and whether the limited retainer and waiver of conflict letter precluded plaintiffs' action.
The duty of client loyalty is incumbent upon all lawyers. In re Op. No. 653 of the Advisory Comm. on Prof'l Ethics, 132 N.J. 124, 129 (1993). In representing clients, attorneys should avoid "placing themselves in the position of serving two masters with incompatible interests." In re Op. 682 of the Advisory Comm. on Prof'l Ethics, 147 N.J. 360, 368 (1997). In the context of a prior representation, "the scope of an attorney's representation of a client is circumscribed by the Rules of Professional Conduct" (RPC). State v. Jimenez, 175 N.J. 475, 484 (2003).
RPC 1.7 provides:
(a) Except as provided in paragraph (b), a lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists if:
(1) the representation of one client will be directly adverse to another client; or
(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client, or a third person or by a personal interest of the lawyer.
(b) Notwithstanding the existence of a concurrent conflict of interest under paragraph (a), a lawyer may represent a client if:
(1) each affected client gives informed consent, confirmed in writing, after full disclosure and consultation, provided, however, that a public entity cannot consent to any such representation. When the lawyer represents multiple clients in a single matter, the consultation shall include an explanation of the common representation and the advantages and risks involved;
"RPC 1.7 reflects 'the fundamental understanding that an attorney will give complete and undivided loyalty to the client' [and] 'should be able to advise the client in such a way as to protect the client's interests, utilizing his professional training, ability and judgment to the utmost.'" J.G. Ries & Sons, Inc. v. Spectraserv, Inc., 384 N.J. Super. 216, 223 (App. Div. 2006) (alteration in original) (quoting State ex rel. S.G., 175 N.J. 132, 139 (2003)). Accordingly, a conflict of interest may preclude a lawyer from representing co-defendants. See In re Petition for Review of Op. 552 of the Advisory Comm. on Prof'l Ethics, 102 N.J. 194, 208 (1986) (recognizing potential conflict of interest in representing co-defendants in the context of municipal government and its officers); Kramer v. Ciba-Geigy Corp., 371 N.J. Super. 580, 602-05 (App. Div. 2004) (discussing conflicts of interest in the joint representation of a corporation and individual defendants).
Apt to these facts is the Court's holding in In re Berkowitz, 136 N.J. 134 (1994). In that matter, an attorney represented a client seeking a zoning variance on land contiguous to the property of a client represented by another attorney at the firm. Id. at 135-36. The second client would be adversely affected if the first client's application were granted. Id. at 135. The Court reprimanded both attorneys, who failed to fully disclose the potential conflict to the clients, noting "the decision of whether to oppose the proposed zoning would obviously create a division of loyalties between [the attorneys] and their clients." Id. at 144.
We also recognize that our Supreme Court has held that New Jersey does not allow a cause of action based solely on a violation of the RPCs and that a violation of a RPC does not, without more, establish legal malpractice. Baxt v. Liloia, 155 N.J. 190, 198-200 (1998). Nevertheless, an attorney's obligations under the RPCs can be relevant and admissible in evaluating the legal duty of an attorney in a malpractice action. See id. at 199-200 ("[T]he existence of a duty owed by an attorney may be supported by reference to an attorney's obligations under the RPCs, and that plaintiffs may present evidence that an attorney has violated the RPCs in cases claiming the attorney has breached his or her duty of care.").
"The issue whether a defendant owes a legal duty is generally a question of law for the court to decide." Clohesy v. Food Circus Supermarkets, Inc., 149 N.J. 496, 502 (1997) (citation omitted). Likewise, "the scope of a duty owed is a matter of law." Ibid. (citing Kelly v. Gwinnell, 96 N.J. 538, 552 (1984)). Whereas issues of breach, foreseeability, and proximate cause are jury matters. Arvanitis v. Hios, 307 N.J. Super. 577, 581-82 (App. Div. 1998).
Defendants argue there was no concurrent conflict between the interests of plaintiffs and Stop & Shop in their pursuing the subdivision application, but if there was such a conflict, the waiver letter was sufficient notice to permit defendants' dual representation. We disagree.
The Court has recognized, particularly in the real estate context, that dual representation that begins as proper can reach a point where it is no longer so. For example, in Sears Mortgage Corp. v. Rose, 134 N.J. 326, 332 (1993), the Court was confronted with whether the title insurance carrier, or the buyer/lender, should bear the ultimate loss caused by the closing attorney's theft of moneys meant to satisfy the first mortgage on the property.
Although the Court considered the closing attorney's relationship to those parties in the context of agency and observed the common practice of having an attorney represent both the title company and the purchaser, the Court concluded that it was at the point when a possible conflict in fact becomes one, and not before, when the dual representation must end. Id. at 342-43. Arguably, both sides had an interest in getting the subdivision, so there was nothing necessarily "invidious" about having one attorney represent both parties in that endeavor. Id. at 343. Nevertheless, that commonality of interest ended because, as between plaintiffs and Stop & Shop, there was a question of whether the lease was still in effect.
Here, the first time that became an issue was in the course of the site plan application, when defendants drafted language for plaintiffs to certify that Stop & Shop was a long-standing lessee. Such language would give rise to Stop & Shop's later claim that plaintiffs were estopped from denying the validity of the lease. By preparing the language and requesting that plaintiffs sign the application, which later inured to plaintiffs' considerable detriment in the purchase option fight, defendants were violating the loyalty they owed plaintiffs. See Estate of Spencer v. Gavin, 400 N.J. Super. 220 (App. Div.), certif. denied, 196 N.J. 346 (2008) (attorney's fiduciary duty includes duty of loyalty and an affirmative obligation to act in and "to look out for" a client's best interests); In re Advisory Comm. on Prof'l Ethics Op. No. 301, 101 N.J.L.J. 209 (Mar. 9, 1978) (lawyers should avoid representing multiple clients where his or her independent judgment may become divided, and if a conflict develops, should withdraw from the matter entirely).
Subsequent to representing plaintiffs in the subdivision application, plaintiffs became former clients, still protected by the rules governing duties to former clients. Under RPC 1.9(a), a lawyer owes a former client a continuing duty of loyalty in the same or a substantially similar matter. See Estate of Spencer, supra, 400 N.J. Super. at 242 (lawyer's duty of loyalty can extend beyond the time when his or her representation of a client has concluded). When defendants were engaged in adverse activity concerning the same property and the same lease involved in the earlier subdivision application, defendants could not represent Stop & Shop against plaintiffs "unless the former client gives informed consent confirmed in a writing." RPC 1.9(a).
Defendants claim that the fact that their future representation of Stop & Shop in the lease matter had been presaged in the waiver letter necessarily exonerated that later representation, and served as the informed consent required by the rule. But in order to be binding, a consent must be informed. Estate of Spencer, supra, 400 N.J. Super. at 243. In plain terms, the consent must properly disclose the risks. See RPC 1.0(e) (informed consent means "the agreement by a person to a proposed course of conduct after the lawyer has communicated adequate information and explanation about the material risks of and reasonably available alternatives to the proposed course of conduct").
Here, the consent involved for a proper waiver of any conflicts regarding the lease would have required that defendants put plaintiffs on the same footing as Stop & Shop with respect to the various issues surrounding the continued legitimacy of the lease in light of Grand Union's bankruptcy, the purported changes over the years in lease-extension protocols, and the assignment miscues. However, the only information defendants purported to disclose was that there was no current conflict, the subdivision application was needed, and that they might represent Stop & Shop on the lease in the future.
Despite their argument that the letter served as a waiver for future conflicts, defendants failed to give plaintiffs the full information about the lease so as to satisfy a complete disclosure. Defendants contend they were unaware of the lease issues given their limited role as subdivision and site plan counsel for Stop & Shop. However, defendants made a blanket representation to plaintiffs that no current conflict existed which appears to be unsupported by sufficient due diligence into the parties' rights and responsibilities under the lease.
The respective rights of a landlord and tenant under any lease are by nature adversarial, and in no way lend themselves to effective or proper dual representation. Moreover, a lease is a contract. Town of Kearny v. Discount City of Old Bridge, Inc., 205 N.J. 386, 411 (2011). Our Supreme Court has issued a "bright-line rule" prohibiting dual representation "in commercial real estate transactions where large sums of money are at stake, where contracts contain complex contingencies, or where options are numerous." Baldasarre v. Butler, 132 N.J. 278, 296 (1993). Independent counsel is especially important in such cases that the Court held that informed consent is irrelevant. Ibid.
Thus, when defendants attempted to act on its reserved right to represent Stop & Shop on the purchase option, plaintiffs arguably may have had legitimate questions about defendants' loyalty during the earlier dual representation in connection with the subdivision. Therefore, defendants' filing suit against plaintiffs, their former clients, presented a real issue about their earlier loyalty.
In any event, at least for purposes of defeating summary judgment, a genuine question existed as to whether defendants, who had a long-standing relationship with Stop & Shop, had hoped to advance the interests of Stop & Shop through the subdivision application and site plan approval to some advantage in the purchase option matter. Subjective elements such as intent and motive particularly are not appropriate for summary resolution. Spragg v. Shore Care & Shore Mem'l Hosp., 293 N.J. Super. 33, 59 (App. Div. 1996). See also McBarron v. Kipling Woods L.L.C., 365 N.J. Super. 114, 117 (App. Div. 2004) ("cases are legion that caution against the use of summary judgment to decide a case that turns on the intent and credibility of the parties").
Thus, defendants' reliance on Lerner v. Laufer, 359 N.J. Super. 201, 217-18 (App. Div.), certif. denied, 177 N.J. 223 (2003), is misplaced. In Lerner, we confronted, in the context of a matrimonial malpractice matter, whether an attorney could limit the scope of his or her representation to reviewing a mediated property settlement agreement (PSA), which he had not drafted or procured. Id. at 204. We held that an attorney did not breach a standard of care in failing to further investigate the merits of the mediated PSA when he did not participate in its mediation, and had set forth the limitations of his representation in that regard in a letter he had the client sign. Id. at 218-20. Lerner did not involve the dual representation at issue here, and the Lerner court did not make any all-encompassing proclamation that an attorney could definitively limit the extent of loyalty owed a client.
The fact that plaintiffs were also represented by Breslin has no effect on the duty owed to plaintiffs. The waiver letter itself made clear that defendants represented plaintiffs notwithstanding Breslin's involvement, and defendants offer no support for the proposition that Breslin's involvement would allow them to evade their direct duty to plaintiffs.
Defendants also assert that given the waiver letter, the court erred in holding that a jury could find they committed malpractice. Defendants contend that the "unique circumstances which led up to the subsequent litigation dispute resulting from allegedly deficient renewal notices was not reasonably foreseeable at the time the limited representation/conflict waiver agreement was executed," particularly given that defendants "were not involved or aware of Stop & Shop's renewal of the lease in April 2007."
There was, however, sufficient evidence that even as they pursued the subdivision application, defendants and Blazoski, with whom they were in close contact, considered the circumstances of the property issues complex, and that as early as 2005 or 2006, they were aware of certain open issues arguably or potentially affecting the eventual exercise of the purchase option.
These material issues of fact in dispute are to be resolved by the jury, Brill, supra, 142 N.J. at 540, as are questions of proximate cause. Komlodi v. Picciano, 217 N.J. 387, 419 (2014). In a negligence action, "[a]lthough the existence of a duty is a question of law, whether the duty was breached is a question of fact." Jerkins v. Anderson, 191 N.J. 285, 305 (2007) (citing Anderson v. Sammy Redd & Assocs., 278 N.J. Super. 50, 56 (App. Div. 1994), certif. denied, 139 N.J. 441 (1995)). "There can be no doubt that the question of negligence in each case may properly be left to the jury with the general instruction . . . of reasonable care under existing circumstances." Universal Underwriters Grp. v. Heibel, 386 N.J. Super. 307, 321 (App. Div. 2006) (quoting Stackenwalt v. Washburn, 42 N.J. 15, 24 (1964)).
Here, plaintiffs produced sufficient evidence of defendants' professional derelictions to allow them to get before the jury on the negligence issue.
As for the court's denial of reconsideration, defendants failed to produce any overlooked law or facts that might have entitled them to a different result at that juncture, and, in fact, do not argue on appeal that they did so below. R. 4:49-2.
B.
Defendants assert that after the court dismissed plaintiffs' legal malpractice expert's report with regard to causation, it erred in allowing the case to proceed before the jury. Defendants claim that an expert's opinion on proximate cause was necessary because of the case's complexity and, without an expert, plaintiffs could not prove damages.
Finally, in a related argument, defendants argue that plaintiffs should not have been allowed to argue that plaintiffs were forced unfairly into settling the underlying claims against Stop & Shop for fear of Conciatori's unfavorable testimony against them had that case continued before the jury. We reject these arguments.
Plaintiffs submitted Michael Ambrosio's expert report in which he concluded, among other things, that defendants breached their duty of care, and that as a proximate cause of such breach, plaintiffs suffered damages because, in settling with Stop & Shop, they received far less for their property than it was worth, and also incurred the additional expenses of litigation. Defendants moved to bar Ambrosio's report. Although the court found Ambrosio was an expert in legal ethics and could testify about any conduct that fell below the legal standard, the court barred him from opining on proximate cause because such conclusions were the province of the jury. Thus, Ambrosio's opinion on proximate cause was barred as a net opinion.
At the close of plaintiffs' case, defendants moved for dismissal, again attacking Ambrosio's opinion. The court granted the motion as to the other counts, but denied it with respect to the malpractice claim, citing in part the fact that the jury could believe Boggia's testimony that he decided to settle the case because of the conflict. When framing the jury instructions, defendants renewed their application for dismissal of the malpractice claim, arguing that plaintiffs had not been submitted "an iota's worth of evidence" related to malpractice. The court found that the evidence from Ambrosio and Boggia was sufficient to give rise to an inference of evidence.
Proximate cause is an essential element of a legal malpractice claim. Jerista, supra, 185 N.J. at 190-91 (noting that duty, breach, and proximate cause are the three essential elements to a legal malpractice case). In an attorney malpractice case, "[t]he test of proximate cause is satisfied where the negligent conduct is a substantial contributing factor in causing the loss," and the burden is on the client to show by a preponderance what injuries were suffered as a proximate cause of the attorney's breach. 2175 Lemoine Ave. v. Finco, Inc., 272 N.J. Super. 478, 487-88 (App. Div.), certif. denied, 137 N.J. 311 (1994). The typical measure of damages is the amount the client would have recovered but for the attorney's breach. Id. at 488.
Expert testimony is required when an issue is beyond the jury's common knowledge. Froom, supra, 377 N.J. Super. at 318. Facts in a malpractice case may be such that, even without the testimony of an expert, the jurors' common knowledge is sufficient to permit a finding that a duty of care has been breached. Butler v. Acme Mkts., Inc., 89 N.J. 270, 283 (1982). "The test of need of expert testimony is whether the matter to be dealt with is so esoteric that jurors of common judgment and experience cannot form a valid judgment as to whether the conduct of the party was reasonable." Ibid.
Under N.J.R.E. 703, an expert's opinion must be based on facts, data, or another's opinion made known to the expert at or prior to trial. Carbis Sales, Inc. v. Eisenberg, 397 N.J. Super. 64, 78 (App. Div. 2007). An opinion lacking in foundation, unsupported by facts or based on bare conclusions is inadmissible. Id. at 79. In legal malpractice cases, the expert must base an opinion on standards accepted by the legal community and not merely on the expert's personally held views. Ibid.
The court determines in its discretion whether an expert has given a net opinion. Correa v. Maggiore, 196 N.J. Super. 273, 282-83 (App. Div. 1984). Here, although the court barred Ambrosio's opinion on proximate cause, he was permitted to describe the applicable standard of care and defendants' breach, so the jury was not left without guidance as to those issues. See Garcia v. Kozlov, Seaton, Romanini & Brooks, P.C., 179 N.J. 343, 362 (2004) ("As in nearly all malpractice cases, plaintiff needed to produce an expert regarding deviation from the appropriate standard").
Ambrosio testified, without objection, that "what [defendants] did in representing . . . plaintiffs, ultimately, prejudiced the plaintiff[s] in subsequent litigation." Ambrosio pointed out that defendants' conduct "created an argument for estoppel by the plaintiffs or waiver of the plaintiffs of whatever defects there were on the lease." Again, defendants did not object. The court properly instructed the jury on the role of expert opinion and on the need in this case for such opinion about the standard of care.
Thus, there is no support for the claim that the jury lacked expert guidance on the critical aspects of defendants' improper conduct or on plaintiffs' damages. Instead, the court merely barred Ambrosio from giving an opinion as to whether defendant's breach was the proximate cause of plaintiffs' losses, and proximate cause is an element regularly left to the fact-finder's determination and considered to be within the jury's province. Arvanitis, supra, 307 N.J. Super. at 582; Anderson, supra, 278 N.J. Super. at 56. Defendants, therefore, were not prejudiced by the case's going to the jury without an expert opinion on proximate cause.
Defendants' reliance on 2175 Lemoine Avenue, supra, 272 N.J. Super. at 490, is misplaced. There, the court concluded that an expert opinion was required "to show that the complex commercial transaction involving the Lemoine Avenue property could have been legally structured to permit Finco to receive the option and partnership." Ibid. The court did not hold that an expert was needed to opine that the defendants proximately caused the alleged damage. Moreover, the type of expert opinion needed in 2175 Lemoine Avenue is akin to Ambrosio's opinion of the applicable ethics standards.
Based on the testimony of Ambrosio and Boggia at trial, the jury could have concluded that defendants' professional breaches caused plaintiffs to compromise their claims against Stop & Shop and to accept a settlement that was less than what they were otherwise entitled to. Such testimony adequately satisfied the "substantial factor" requirement. Id. at 487 ("The test of proximate cause is satisfied where the negligent conduct is a substantial contributing factor in causing the loss.").
Defendants' argument that the "long, complicated history of the property" required expert opinion on the "substantial factor" issue supports the conclusion that the overall context of the lease and purchase option presented circumstances that could not justify defendants' attempt to represent both sides in the non-adversarial subdivision application and then only Stop & Shop in the lease contest.
Defendants attack the court's denial of their motion to strike part of Ambrosio's testimony where he gave an opinion on Boggia's settling the case against Stop & Shop. Specifically, near the end of Ambrosio's direct testimony, he was asked whether defendants would have had to disclose the value of the purchase option under the lease in order for any waiver to have been valid. Ambrosio repeated his earlier conclusion that the conflict was such that it could not have been waived regardless, but assuming it could, defendants still would have had to give plaintiffs the necessary information for an informed consent.
Ambrosio went on to discuss, without interruption by defense counsel, all the circumstances that informed his conclusion that both Breslin and plaintiffs had been misled by defendants as to the value of the lease, leading to the point where Boggia had gotten involved and had finally asked for proof of the lease's validity. He then said:
And so Mr. Boggia . . . appropriately settled the case, because he was contending with the possible testimony of two of the defendants as to how the conduct that they induced by soliciting the representation of the plaintiff would ultimately be the basis for an argument that there was waiver or estoppel that would prevent [plaintiffs] from saying . . . that they didn't have an effective lease.
Ambrosio concluded that it was "fairly obvious . . . the plaintiff was prejudiced by virtue of the decision to undertake the representation initially of the — both plaintiffs and Stop and Shop." When defense counsel objected on the grounds that the answer was not responsive to the original question and moved to strike, the court overruled the objection.
Defendants now assert that Ambrosio's statement may have improperly influenced the jury to believe that settlement was proper, that Ambrosio's statement was counter to the court's earlier ruling limiting his expert opinion, and that Ambrosio's statement was not supported by proof that Conciatori would have actually testified detrimentally to plaintiffs. We reject these arguments.
First, defendants did not object on those grounds at the time. Second, they had not objected, as noted above, at other times when Ambrosio had discussed estoppel and the prejudicial aspects of defendants' behavior. Third, the admission of testimony is within the trial court's discretion, and an appellate court gives substantial deference to the exercise of that discretion. Benevenga v. Digregorio, 325 N.J. Super. 27, 32 (App. Div. 1999), certif. denied, 163 N.J. 79 (2000). As the trial court noted, with that final question, Ambrosio's direct testimony was complete, and defendants were free to cross-examine him at length, which they proceeded to do.
Defendants next assert that plaintiffs lacked any proof that they would have received more than $2.5 million for the sale of the property. This is belied by the record as defendants' own expert valued the property at $3.1 million; plaintiffs' expert valued the property at $4.6 million; the property was assessed at $4.7 million; and Boggia, on cross-examination, testified without challenge to a value of $5 million.
Finally, defendants assert that had Conciatori testified in the underlying litigation, his testimony would have been absolutely privileged, so that plaintiffs were prevented from asserting a professional negligence claim based on any such testimony. The court ruled that if Conciatori testified he could not relate matters that were subject to the attorney-client privilege held by Stop & Shop.
But, in any event, plaintiffs were not asserting malpractice against defendants based on potential litigation testimony, so the point is superfluous. Plaintiffs' only assertion about Conciatori's potential testimony was that, given his and the other defendants' asserted negligence, the prospect of his testifying was intimidating to one of the elderly plaintiffs. Moreover, even without Conciatori's testimony, the record included sufficient evidence to permit the jury to consider the merits of defendants' malpractice.
C.
Next, we turn to defendants' argument that the court erred by refusing to dismiss the complaint based on the entire controversy doctrine. Defendant contends that the malpractice claims against defendants should have been raised in the underlying suit against Stop & Shop. We disagree.
The entire controversy doctrine is codified in Rule 4:30A:
Non-joinder of claims required to be joined by the entire controversy doctrine shall result in the preclusion of the omitted claims to the extent required by the entire controversy doctrine, except as otherwise provided by R. 4:64-5 (foreclosure actions) and R. 4:67-4(a) (leave required for counterclaims or cross-claims in summary actions).The doctrine is based on the principle that a legal controversy should be adjudicated in a single litigation before one court, and that all parties involved should present all claims and defenses related to the underlying controversy. Wadeer v. N.J. Mfrs. Ins. Co., 220 N.J. 591, 605 (2015).
[T]he purpose[s] of the entire controversy doctrine "are threefold: (1) the need for complete and final disposition through the avoidance of piecemeal decisions; (2) fairness to parties to the action and those with a material interest in the action; and (3) efficiency and the avoidance of waste and the reduction of delay."
[Ibid. (quoting DiTrolio v. Antiles, 142 N.J. 253, 267 (1995).]
In deciding whether to apply the bar, the court considers whether the claims against the different parties arise from related facts or the same transaction or series. Ibid. "It is the core set of facts that provides the link between distinct claims against the same or different parties and triggers the requirement that they be determined in one proceeding." DiTrolio, supra, 142 N.J. at 267-68 (citations omitted). Commonality of legal issues, however, is not required. Id. at 271. Likewise, the doctrine does not apply to unknown or unaccrued claims. Wadeer, supra, 220 N.J. at 606. Ultimately, the central consideration is fairness, both to the court system and to the parties. Id. at 605.
Here, defendants raised the entire controversy doctrine in their answer as a defense; however, they did not actually address it until the close of plaintiffs' case, at which point, having moved for involuntary dismissal, defendants also asserted that the malpractice claim was barred by entire controversy principles. The court denied both motions and, in addressing the entire controversy aspect, said only that it was an application "not appropriately made." We agree with this result.
The law no longer compels the assertion of a legal malpractice claim in the underlying suit that gives rise to the claim. Sklodowsky v. Lushis, 417 N.J. Super. 648, 654 (App. Div. 2011). In Sklodowsky, we held it would be unfair to prejudice the client, and "chill" the attorney-client relationship, by requiring a client to bring legal malpractice claims in the underlying suit. Id. at 654-55.
Similar fairness concerns militate in favor of affirmance in this case. The prospect of plaintiffs ever suing defendants, as a practical matter, turned in large degree upon plaintiffs' success against Stop & Shop in the underlying suit. Had plaintiffs prevailed, or had they been able to settle for a sum closer to what they considered fair market value, the likelihood that they would have ever sued defendants seems greatly reduced.
Likewise, there is no evidence suggesting that defendants were prejudiced in this case. Defendants contend that the delay deprived them of the opportunity to depose plaintiffs and Breslin before they passed away or suffered mental health deterioration. However, this claim is belied by the record. Little more than two years passed between the filing of the two suits, and defendants did not address the issue until almost three years after the malpractice complaint was filed, and only then during the trial, after plaintiffs had rested.
D.
Defendants next contend that the court erred in its instructions to the jury. Defendants assert that the jury charge failed to make clear that their representation of plaintiffs did not continue beyond the subdivision application process, and that the court compounded the problem by refusing to answer the jury's questions on that point. Defendants further argue that the court erred in refusing to charge RPC 1.9, duties to a former client, with respect to defendants' fiduciary duties to plaintiffs, and that the court failed to provide the proper legal framework for the jury in resolving their questions, simply leaving the jurors to decide matters of law. We disagree with these contentions.
The jury is entitled to clear and correct charges, and the absence of them may constitute plain error. Wade v. Kessler Inst., 172 N.J. 327, 341 (2002). However, we will not disturb a jury's verdict "where the charge, considered as a whole, adequately conveys the law and is unlikely to confuse or mislead the jury, even though part of the charge, standing alone, might be incorrect." Ibid. (quoting Fischer v. Canario, 143 N.J. 235, 254 (1996)). The same standard of review applies to jury interrogatories and verdict sheets. Ibid.
In charging the jury, the court made clear that it is the judge of the law, while the jury is the arbiter of the facts. It charged the jury on the principles governing legal malpractice and instructed the jury on the application of ethics rules. The court defined relevant terms, including negligence, foreseeability and proximate cause, and explained how the jury was to calculate damages, if any. Finally, the court reviewed the verdict sheet, containing only three questions: "Did defendants deviate from the standard of care in providing legal services to the plaintiff?" If so, "[w]as defendants' deviation a proximate cause of monetary loss to the plaintiff?" And, if so, "[w]hat amount of money will fairly and justly compensate the plaintiff for the economic harm suffered?" Defendants did not object to the charge.
At some point during the deliberations, the jury asked two questions that the court then read to counsel:
Does question number one meaning from the verdict sheet, apply only to the representation during the subdivision? And the second juror question is how long does fiduciary responsibility last after specific representation has concluded?Defendants urged the court to answer yes to question one, but plaintiffs disagreed. With respect to the second question, defendants urged the court to reply that there is no continuing fiduciary responsibility. Plaintiffs contended the fiduciary responsibility of the attorney lasts "indefinitely," and cited RPC 1.9 for support.
The court disagreed with both parties, and proposed telling the jury that their questions were ones that the jury needed to answer for itself. It also referred to the dictionary definition of "fiduciary duty," noting that the term was "vague" and "has been pressed into service for a number of ends." Thus, the court believed that whether defendants "still had a fiduciary duty or not [after the subdivision approval] and whether they still had representation[]" were issues for the jury to decide.
The judge brought the jury back, and charged them as follows:
When I charge[d] the jury I specifically pointed out that it's your role to decide this case, not mine. Now with regard to question number one. Does question number one [on the verdict sheet] apply only to the representation during the subdivision? And question number two is how long does fiduciary responsibility last after specific representation has concluded? With regard to those questions, those questions are for you to answer, not the Court. You may go back into the jury room and answer those questions along with any other questions you may have.
As an initial matter, we reject any argument that the verdict sheet or initial jury charge were insufficient. The form of the verdict sheet was arrived at after extensive conferencing, and was consented to by defendants. Defendants concede that the court charged the jury in accordance with the model charges on malpractice, as relates to incomplete legal advice, and damages. Defendants also acknowledge that the reason "the jury was not charged on the law concerning the determination of an attorney-client relationship" was that "the Price Meese Defendants conceded representation of the Plaintiffs during the subdivision application." Finally, we again note that defendants did not object at the conclusion of the charge.
Likewise, we reject defendants' contention that the court incorrectly answered the first jury question. The scope of defendants' representation of plaintiffs was one of the critical issues for determination by the jury. The terms of an agreement for legal representation involves questions of fact, and is distinguishable from the legal determination of the scope of a duty. See Clohesy, supra, 149 N.J. at 502. Thus, the court did not err by leaving that issue for the jury to decide.
Finally, we reject defendants' argument that the court committed reversible error by failing to instruct the jury on RPC 1.9. We note that plaintiffs, not defendants, requested an instruction on RPC 1.9. Indeed, defendants opposed an instruction on RPC 1.9, and advocated a different, contradictory instruction. A disappointed litigant may not claim on appeal that an adverse decision below was a result of error that that party itself urged. Brett v. Great Am. Recreation, Inc., 144 N.J. 479, 503 (1996); State v. Ramseur, 106 N.J. 123, 281-82 (1987) (applying invited error in context of jury charge).
Additionally, while the court never charged the jury expressly on RPC 1.9 and duties to former clients per se, as noted, the principles contained in RPC 1.9 were addressed by Ambrosio, plaintiff's expert in professional ethics, conflicts of interest, and legal malpractice. Ambrosio discussed the ethical principles that barred "disloyalty" to "a former client." He told the jury that an attorney "cannot sue a former client in the same . . . or [a] substantially related matter," and that this "was a case of a substantial[ly] related matter."
E.
Defendants' final argument is that the court erred by leaving to the jury the issue of whether or not the purchase option contained in the 1976 amendment was legally binding. Defendants assert the construction of the lease was a purely legal question. They further allege that, even if there were factual issues to be resolved, the court should have given the jury special interrogatories to direct the jury's deliberations of those issues. Again, we disagree.
The construction of a contract, such as the lease at issue in this case, is generally an issue of law, within the province of the judge. See, e.g., Selective Ins. Co. of Am. v. Hudson E. Pain Mgmt. Osteopathic Med. & Physical Therapy, 210 N.J. 597, 605 (2012). However, the parties' intent in seeking and agreeing to the 1976 amendment permitting automatic renewals presented questions of fact for the jury. See Jennings v. Pinto, 5 N.J. 562, 569-70 (1950) (holding that, where the effect of a written instrument depends not only on its construction but also on "disputed collateral facts" and extrinsic circumstances, the inferences to be drawn are for the jury's determination); Terminal Constr. Corp. v. Bergen Cty. Hackensack River Sanitary Sewer Dist. Auth., 18 N.J. 294, 310-11 (1955) (quoting Jennings). Likewise, the intent underlying the parties' subsequent relations in tendering and accepting written renewals also presents questions of fact. Thus, because the effect of the lease depended not only on its construction but also on "disputed collateral facts" and extrinsic circumstances, the court did not err by leaving the issue to the jury.
Furthermore, we discern no error in the court's decision to forego the use of special interrogatories. Although our Supreme Court recommends special interrogatories in certain circumstances, their use is not mandatory. See Cox v. Sears Roebuck & Co., 138 N.J. 2, 16 (1994). "Appellate courts should review jury instructions as a whole, and may not reverse if the charge adequately conveys the law and is unlikely to confuse or mislead the jury." Boryszewski v. Burke, 380 N.J. Super. 361, 374 (App. Div. 2005), certif. denied, 186 N.J. 242 (2006) (citing Sons of Thunder, Inc. v. Borden, Inc., 148 N.J. 396, 418 (1997)). The instructions were not misleading nor confusing, thus, we will not disturb the jury's determination.
III.
Finally, we turn to the points raised in plaintiffs' cross-appeal. Plaintiffs contend the court erred by dismissing their punitive damages and fraud claims. Plaintiffs argue that they presented sufficient evidence at trial suggesting the willfulness and wantonness of defendants' conduct to avoid dismissal of their claims. They also argue that the court erred by refusing to compel disclosure of certain privileged documents which they contend were relevant to those claims. We disagree with these contentions.
Our standard of review on an appeal from a motion to dismiss under Rule 4:37-2(b) is whether the evidence, together with all legitimate inferences, could sustain a judgment in favor of the party opposing the motion. See R. 4:40-1; Besler v. Bd. of Educ. of W. Windsor-Plainsboro Reg'l School Dist., 201 N.J. 544, 572 (2010); Potente v. Cnty. of Hudson, 187 N.J. 103, 111 (2006). We are "not concerned with the worth, nature or extent (beyond a scintilla) of the evidence, but only with its existence." Dolson v. Anastasia, 55 N.J. 2, 5-6 (1969). In reviewing the sufficiency of the evidence, we accept as true all evidence supporting the claim, and accord that evidence all favorable inferences. Ibid. Applying that standard here, we are satisfied that dismissal was properly granted.
In order to obtain punitive damages, a plaintiff must prove by clear and convincing evidence that the harm suffered was motivated by actual malice on the part of the defendant, "or accompanied by a wanton and willful disregard of persons who foreseeably might be harmed." N.J.S.A. 2A:15-5.12(a); Nappe v. Anschelewitz, Barr, Ansell & Bonello, 97 N.J. 37, 49 (1984). Likewise, in order to make a claim for fraud, a plaintiff must demonstrate that the defendant made a material misrepresentation of a presently existing or past fact, that the defendant had knowledge or belief of its falsity, that the defendant intended that the plaintiff rely on it, that the plaintiff reasonably relied upon it, and that damages resulted. Gennari v. Weichert Co. Realtors, 148 N.J. 582, 610 (1997).
At the end of plaintiff's case, the trial court found that plaintiffs failed to present evidence of maliciousness or willful disregard on the part of defendants, and granted defendants' motion for involuntary dismissal on plaintiff's punitive damages and fraud claims. Now, plaintiffs argue that "[d]efendants . . . willfully and wantonly solicited the conflicted representation of Plaintiffs without regard for how the actions they induced Plaintiffs to take would affect their rights under the lease." Plaintiffs also contend that, because the court denied defendant's motion for involuntary dismissal of their malpractice claim, it should not have dismissed their claims for punitive damages and fraud. We disagree.
The state of mind required to make a claim for malpractice is different from that required to recover punitive damages. See Packard-Bamberger & Co. v. Collier, 167 N.J. 427, 443 (2001) ("[A]n attorney who intentionally violates the duty of loyalty owed to a client commits a more egregious offense than one who negligently breaches the duty of care."). In order to recover punitive damages in a legal malpractice action, the attorney's conduct must be wantonly reckless or malicious, or include a positive component of conscious impropriety. Gautam v. De Luca, 215 N.J. Super. 388, 400-01 (App. Div.), certif. denied, 109 N.J. 39 (1987).
Here, nothing suggests that defendants authored the waiver letter at a point when they suspected the purchase option was likely no longer valid. Likewise, plaintiffs point to no evidence that defendants were retained within the relevant time period to determine the validity of the purchase option, and there is no evidence that defendants undertook a serious examination of the purchase option. In the absence of such evidence, we see no reason to disturb the trial court's decision to dismiss plaintiffs' punitive damages and fraud claims.
Likewise, we reject plaintiff's argument that the court abused its discretion in refusing to compel discovery of certain privileged documents. All trial discovery decisions are made in the court's broad discretion. C.A. ex rel. Applegrad v. Bentolila, 219 N.J. 449, 459 (2014). As a result, "[w]e generally defer to a trial court's disposition of discovery matters unless the court has abused its discretion or its determination is based on a mistaken understanding of the applicable law." Rivers v. LSC P'ship, 378 N.J. Super. 68, 80 (App. Div.), certif. denied, 185 N.J. 296 (2005)).
Here, the court denied plaintiffs' motion because the communications at issue were privileged communications between a lawyer and client, and "[p]laintiffs . . . failed to demonstrate that the documents withheld as privileged should be produced." Subsequently, in denying plaintiffs' motion for reconsideration, the court went into more detail, concluding:
[t]he movant has engaged in a spurious and vexatious discovery expedition. These discovery demands are wholly irrelevant, harassing and are merely an attempt to seek attorney client information.
The relevant discovery has already been disclosed in the long tortured prior and
present proceedings concerning these events. The information is not even [defendants'] to disclose but is that of Stop & Shop.
Plaintiffs contend that the court should have performed an in camera review of the requested documents, that the requested documents were not privileged, and that the documents were relevant to plaintiffs' punitive damage claims. We disagree.
We generally construe our discovery rules liberally, "in favor of broad pretrial discovery." Payton v. N.J. Tpk. Auth., 148 N.J. 524, 535 (1997) (citing Jenkins v. Rainner, 69 N.J. 50, 56 (1976). However, we would not compel a party, or, for that matter, a trial judge, to submit to an in camera review of privileged documents in the absence of any reasonable argument, grounded in the record, that those documents are discoverable. Plaintiffs fail to make such an argument.
Plaintiffs do not provide an exhaustive list of the documents being sought. However, it appears that some of the documents at issue are communications between defendants and their client, Stop & Shop. Plaintiffs contend these communications are stripped of their privilege because an attorney for Stop & Shop testified at trial "to matters that he . . . learned in the course of his representation of Stop & Shop . . . ." However, plaintiffs do not specify what information the attorney disclosed that was capable of destroying Stop & Shop's privilege.
Likewise, plaintiffs point out that privilege may be waived when a client "calls his attorney to the stand." See United Jersey Bank v. Wolosoff, 196 N.J. Super. 553, 565 (App. Div. 1984) (citing Aysseh v. Lawn, 186 N.J. Super. 218, 225 (Ch. Div. 1982)). However, that is not the case here. Stop & Shop, to whom the privilege belongs, was not a party to this suit, and thus could not call its attorneys to the stand. We therefore see no reason to disturb the trial judge's decision not to compel discovery of the documents at issue.
In their cross-appeal, plaintiffs also argue that the court erred in barring certain evidence relevant to their fiduciary and fraud claims as they relate to punitive damages. Specifically, they claim the court wrongly excluded the 2001 "mistaken" lease assignment, the 1979 sublease with the separate assignments of the purchase option, any discussion of an unpublished appellate court opinion regarding plaintiffs' estoppel argument and Price's deposition testimony regarding that appellate opinion, Stephen Boswell's testimony about his mother, which described why plaintiffs decided to settle with Stop & Shop, and Ambrosio's opinion about proximate cause. "As a general rule, admission or exclusion of proffered evidence is within the discretion of the trial judge whose ruling is not disturbed unless there is a clear abuse of discretion." Dinter v. Sears, Roebuck & Co., 252 N.J. Super. 84, 92 (App. Div. 1991). We discern no such abuse of discretion here with respect to the challenged exclusions.
Plaintiffs also claim the court should not have quashed certain subpoenas duces tecum. We review the trial court's decision to quash the subpoena pursuant to a deferential standard of review. Decisions of trial courts on discovery matters are upheld unless they constitute an abuse of discretion. Pomerantz Paper Corp. v. New Cmty. Corp., 207 N.J. 344, 371 (2011). Again, we discern no such abuse of discretion.
Finally, plaintiffs contend the court erred by denying their application for additional counsel fees pursuant to their amended counsel fee arrangement. Defendants opposed the motion, noting that plaintiffs' signatures to the amended retainer agreement were not provided. This fact is particularly salient since plaintiff Belthoff was dead at the time of the amendment, and plaintiff Boswell was, by plaintiffs' counsel's own admission, suffering from dementia. A trial judge's decision on an application for fees or sanctions is reviewed under an abuse of discretion standard. United Hearts v. Zahabian, 407 N.J. Super. 379, 390 (App. Div.) (citing Masone v. Levine, 382 N.J. Super. 181, 193 (App. Div. 2005)), certif. denied, 200 N.J. 367 (2009). We discern no abuse of discretion in the court's decision to deny plaintiff's motion.
Plaintiffs' remaining contentions are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed on the appeal and cross-appeal. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION