Opinion
DOCKET NO. A-2621-13T3
05-05-2015
LAURENCE HALIMI, Plaintiff-Appellant, v. PIKE RUN MASTER ASSOCIATION, Defendant-Respondent, and ACCESS PROPERTY MANAGEMENT, INC. and USA HOMES REALTY, LLC, Defendants.
Brian M. Cige argued the cause for appellant. Michael S. Karpoff argued the cause for respondent (Hill Wallack LLP, attorneys; Mr. Karpoff, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Fisher and Accurso. On appeal from the Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-900-11. Brian M. Cige argued the cause for appellant. Michael S. Karpoff argued the cause for respondent (Hill Wallack LLP, attorneys; Mr. Karpoff, on the brief). PER CURIAM
This appeal requires our consideration of defendant's late assertion of plaintiff's lack of standing and its impact on plaintiff's attempts to obtain enforcement of the terms of the parties' settlement agreement.
This action has its genesis in the assertion of fines imposed by defendant Pike Run Master Association against plaintiff, a unit owner, who placed a "for sale" sign on her property contrary to a condominium bylaw. Plaintiff thereafter contracted to sell her unit but closing was delayed when a lien based on the accrued fines stood in the way of her conveyance of clear title. Consequently, on June 6, 2011, plaintiff filed a complaint against Pike Run, alleging a violation of her right to display a sign on her property and seeking damages and other relief.
On September 24, 2012, the parties amicably resolved the issues raised in this suit. Pike Run agreed: to pay plaintiff a certain amount to be kept confidential; to amend its bylaws to comport with Mazdabrook Commons Homeowners' Association v. Khan, 210 N.J. 482 (2012); and to forego enforcement of its existing signage bylaw. At some point not revealed in the record on appeal, the monetary sum was paid to plaintiff. In August 2013, upon learning Pike Run had not amended its bylaws, plaintiff demanded compliance with the settlement agreement and, when compliance was not forthcoming, plaintiff moved for enforcement of the settlement agreement. The parties thereafter consented to an order, entered on August 27, 2013, which contained both Pike Run's promise to amend the signage bylaws at its November 27, 2013 meeting and the parties' agreement that plaintiff "may make an application for fees and costs pursuant to Rule 1:10-3 for enforcing litigant's rights." A revised order, entered on September 11, 2013, memorialized Pike Run's promises to provide plaintiff with notice of its actions in amending the bylaw and to refrain from enforcing the existing bylaw.
Pursuant to the terms of these two consent orders, plaintiff applied for counsel fees. On or about September 23, 2013, without filing or serving a notice of motion, plaintiff submitted to the trial court a certification of services rendered which failed to comply with the requirements of Rule 4:42-9(b) and RPC 1.5. When Pike Run did not respond, the judge entered an order, dated October 2, 2013, which directed Pike Run to pay plaintiff $7 680.36, the entire amount plaintiff sought.
When the ordered fees were not thereafter paid, despite demands, plaintiff sought enforcement by way of a motion filed on December 17, 2013. On January 21, 2014, Pike Run's new attorney cross-moved to vacate the October 2, 2013 order. These motions were heard by a different judge.
The record on appeal includes a copy of plaintiff's counsel's email of November 13, 2013, and a copy of his December 13, 2013 letter to Pike Run's former counsel memorializing telephone discussions concerning, and seeking payment of, the fees awarded on October 2, 2013.
It is not clear why these cross-motions were not heard by the judge who entered the prior orders, including the order in question — the far better practice.
Pike Run's cross-motion included a certification of its former attorney, who acknowledged the orders incorporated plaintiff's right to move for counsel fees. Pike Run's former counsel, however, asserted that he "expected to receive a copy of that application [for fees]," that he did not "recollect ever seeing the certification or the cover letters directed to [him] until copies" were provided by Pike Run's new attorney, and that he "did not see the October 2, 2013 [o]rder until" he received plaintiff's December 17, 2013 enforcement motion. He further claimed: "I do not believe that I ever received them previously. If they were actually received in my office in September or October, I never saw them."
In seeking relief from the counsel-fee order, Pike Run not only relied on the claim that its former counsel's mistakenly failed to respond or was apparently not served or did not actually receive the fee application. Pike Run also — and for the first time in the proceedings — argued that plaintiff did not have standing to seek enforcement of the August and September 2013 orders because plaintiff was no longer an owner of property in the association. In addition, Pike Run claimed there was no basis for enforcing the August and September 2013 orders because the failure to amend the bylaws was merely a product of "confusion and unclear messages," and in fact, the bylaws had been amended.
The date upon which plaintiff transferred title to her condominium unit is not readily apparent in the record on appeal; we assume, however, that this event occurred months before the filing of the complaint in this action on June 13, 2011, since it is alleged in the complaint that the closing took place on January 31, 2011.
At oral argument in the trial court on January 31, 2014, Pike Run's attorney asserted that "the board adopted the amendment and . . . it was forwarded to the [c]ounty [c]lerk's [o]ffice on Monday[,]" which we assume meant January 27, 2014. He also stated at that time that he had brought to court copies of the amendment for the benefit of the court and plaintiff's counsel.
The judge denied plaintiff's motion for enforcement and granted Pike Run's motion to vacate the October 2, 2013 fee order. This second judge concluded enforcement was precluded by Haynoski v. Haynoski, 264 N.J. Super. 408 (App. Div. 1993), thereby rendering the fee order void, pursuant to Rule 4:50-1(d). The judge also stated that the August and September 2013 consent orders were void, a holding no one sought. notwithstanding those comments, which were not embodied in the judge's order, the judge later recognized in his opinion that plaintiff's motion to enforce, which led to the entry of those consent orders, was a reasonable step in light of Pike Run's failure to "respond [to plaintiff's earlier inquiries] other than to say, 'We'll get back to you.'" In any event, the judge concluded that once plaintiff transferred title to her property in the association she lost standing to enforce the settlement agreement beyond the agreement's monetary aspects.
It is not clear to us what the judge meant — in referring to the consent orders — that "[r]easonable minds can differ about whether or not . . . th[ose] order[s] [are] still equitable."
The judge also determined that plaintiff's certification of services were not in conformity with Rule 4:42-9(b) and RPC 1.5.
Plaintiff appeals the January 31, 2014 order, which vacated the October 2, 2013 order, arguing the judge erred in finding plaintiff lacked standing and in granting Pike Run relief from that order.
In considering the arguments raised in this appeal, we briefly turn to Haynoski, which held that Rule 1:10-5, which is now Rule 1:10-3, does not permit an award of fees when a party moves to enforce a private agreement to settle litigation. 264 N.J. Super. at 413-14. In Haynoski, the plaintiff moved in the Chancery Division for enforcement of an agreement to settle the action and for an award of counsel fees expended in those efforts. Id. at 410. We recognized that "the settlement was never incorporated in an order or judgment" but "was simply a contract entered into between the parties as a condition for the dismissal of pending litigation." Id. at 414. Consequently, we held that "[t]he sine qua non for an action in aid of litigant's rights, pursuant to [Rule 1:10-3], is an order or judgment; a predicate element missing here." Ibid.
This interpretation of Rule 1:10-3, with which we remain in accord, has only partial application here. For example, had plaintiff moved for an award of counsel fees when originally seeking the court's aid in compelling Pike Run to comply with the settlement agreement, Haynoski would have required the denial of that fee request; the settlement agreement did not contain a provision authorizing such an award. But, here, Pike Run consented to the entry of an order memorializing the settlement agreement in August 2013, which provided the required platform — what Judge Keefe in Haynoski referred to as the sine qua non — for an award of fees in seeking the future enforcement of the consent order.
More importantly, we consider the judge's determination that plaintiff lost standing to seek enforcement of either the settlement agreement or the later confirming orders insofar as they compelled the amending of the bylaws because she had transferred her interest in the property and was no longer a member of the defendant association. Considered on a clean slate, the judge's view of standing is accurate. See, e.g., Comm. for a Better Twin Rivers v. Twin Rivers Homeowners' Ass'n, 383 N.J. Super. 22, 67 (App. Div. 2006), rev'd on other grounds, 192 N.J. 344 (2007). This case is unusual, however, because of Pike Run's inexplicably late assertion of plaintiff's lack of standing.
No one questions plaintiff's standing to pursue the monetary remedies permitted by the settlement agreement because those rights indisputably survived her transfer of title.
Even more unusual is the fact that plaintiff transferred title to the property before the settlement agreement was reached; it is odd and somewhat inconsistent with what was argued in the last trial court proceeding, and with what has been argued here, that Pike Run would promise plaintiff that it would amend the bylaws when plaintiff no longer owned any property within the association. Stated another way, the record fairly suggests — or provides a reasonable inference — that Pike Run negotiated with and promised to plaintiff changes in the bylaws because it viewed her as speaking for other property owners notwithstanding she did not commence the action as a representative of others.
Pike Run then further acted in conformity with its assumption that plaintiff possessed standing because, when plaintiff later sought enforcement of the settlement agreement, Pike Run negotiated with her and consented to the incorporation of portions of the settlement agreement into a consent order. And Pike Run again kept to itself its belief that plaintiff lacked standing when consenting to another order, which was entered in September 2013.
In fact, it was not until cross-moving for relief from the October 2, 2013 counsel-fee order that Pike Run asserted — for the first time in more than thirty-two months since plaintiff transferred her property interests — that plaintiff lacked standing.
To be sure, a party's standing cannot be created by consent or a failure to object. See N.J. Citizen Action v. Riviera Motel Corp., 296 N.J. Super. 402, 411-12 (App. Div. 1997), appeal dismissed as moot, 152 N.J. 361 (1998). But standing is not a matter of jurisdiction, only justiciability, which does not preclude but only counsels against the invocation of the court's power to act; as we said in N.J. Citizen Action, the lack of standing is "a judicially constructed and self-imposed limitation," id. at 411, which ensures that "the invocation and exercise of judicial power" were appropriate in the given case, id. at 412. See also Deutsche Bank Nat'l Trust Co. v. Russo, 429 N.J. Super. 91, 101-02 (App. Div. 2012). Because the standing requirement is not as inexorably applied as an absence of jurisdiction, we conclude that a party's lack of standing may at times be disregarded to avoid an inequitable consequence. This case presents such a unique situation.
In light of the procedural history outlined above, we find it would be inequitable to allow Pike Run to play its standing trump card — founded on plaintiff's transfer of title, a fact well known to Pike Run since it occurred before suit was filed — and thereby avoid the consequences of its failure to fully abide by the settlement agreement and later court orders at such a late date. The equities further favor plaintiff's position since, by agreeing with her to amend its bylaws at a time when she was no longer a property owner, Pike Run implicitly viewed her as having the right to seek vindication not only of her rights but also the rights of other property owners. In short, even though we generally recognize that standing cannot be created by a defendant's failure to object, we find it inequitable in the particular circumstances presented here to absolve Pike Run of its dilatory compliance with the consent orders through its late assertion of plaintiff's lack of standing. See In re Estate of Shinn, 394 N.J. Super. 55, 70 (App. Div.) (applying estoppel principles when a party had previously remained silent when conscience required that party to speak), certif. denied, 192 N.J. 595 (2007). Pike Run allowed plaintiff to expend her time and expenses and now tardily argues she lacked standing. Even though we agree plaintiff lacked standing to complain about the bylaws once she transferred her ownership interest, Pike Run's failure to speak when conscience demanded its assertion of the standing requirement now commands that Pike Run remain silent in that regard. Plaintiff is entitled to pursue her claim for fees for her efforts in seeking enforcement from the time of the August 27, 2013 order.
We, thus, reverse the January 31, 2014 order under review, and we remand for consideration of plaintiff's claim for fees incurred in seeking enforcement of the August and September 2013 consent orders. We lastly observe that the judge appears to have vacated the October 2, 2013 order on the alternative ground that the failure of Pike Run's former counsel to respond to plaintiff's fee application should not be visited on Pike Run and, also, that plaintiff's certification of services was inadequate. We find no fault in those conclusions, although the former would ordinarily require further examination after an evidentiary hearing. Those determinations, however, do not result in a bar to an award of fees; they merely suggest that plaintiff should have been given the opportunity to provide a proper certification of services, and Pike Run should have been given an opportunity to respond to that certification on its merits. Pike Run, however, should not be further heard on the question of standing in that regard, but it should be permitted to further argue that the fees were unreasonable or unnecessary or incurred prior to entry of the August 27, 2013 consent order. We remand for these further proceedings.
Pike Run contends that plaintiff is not entitled to fees because her attorney is her husband. Although we are aware of no bar to an award of fees in such circumstances, it is for the trial court, in the proceedings to follow, to assess whether or to what extent that fact may impact on plaintiff's fee application.
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Reversed and remanded. We do not retain jurisdiction. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION