Opinion
DOCKET NO. A-1504-13T1
01-21-2015
PAUL SILVERMAN, Plaintiff-Respondent, v. BANK OF AMERICA, N.A., JONES LANG LASALLE MANAGEMENT COMPANY OF NEW JERSEY, LLC, Defendants-Respondents, and BOROUGH OF FREEHOLD, Defendant-Appellant.
Stephen M. Knudsen argued the cause for appellant (Durkin & Durkin, attorneys; Mr. Knudsen, of counsel and on the briefs). Patrick H. Cahalane argued the cause for respondent Paul Silverman (Anglin, Rea & Cahalane, P.A., attorneys; Mr. Cahalane, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Messano and Ostrer. On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-6056-10. Stephen M. Knudsen argued the cause for appellant (Durkin & Durkin, attorneys; Mr. Knudsen, of counsel and on the briefs). Patrick H. Cahalane argued the cause for respondent Paul Silverman (Anglin, Rea & Cahalane, P.A., attorneys; Mr. Cahalane, on the brief). PER CURIAM
The Borough of Freehold appeals from the trial court's order denying its Rule 1:4-8 motion to impose sanctions on plaintiff's attorney. Having reviewed Freehold's arguments in light of the record and the applicable principles of law, we affirm.
I.
This was a slip-and-fall case. Plaintiff Paul Silverman alleged that he slipped on a patch of ice on the public sidewalk in front of a branch office of defendant Bank of America (BOA). He injured his elbow, head and neck.
The ice had formed in a depression in the brick paver sidewalk. Plaintiff's expert opined that the depression was caused by the long term dripping of water from a damaged gutter system on the BOA building. The same defective gutter system was responsible for the pool of water that turned to ice and led to plaintiff's fall. Plaintiff's expert opined that the sidewalk depression existed for an extended period of time.
Plaintiff sued BOA, Freehold, and the companies that allegedly maintained the BOA property. Plaintiff asserted that BOA and the other defendants negligently maintained the property. Plaintiff also asserted that Freehold had actual or constructive notice of the sidewalk defect, and its failure to remediate it was palpably unreasonable.
Plaintiff named Jones Lang LaSalle, Inc., Jones Lang LaSalle Americas, Inc., Jones Lang LaSalle Management Company of New Jersey, LLC, and Tower Cleaning Systems, Inc., as well as various fictitious parties. Apparently, one of the Jones Lang entities was the management company for the property.
Plaintiff apparently filed three amendments to his original complaint. However, Freehold has included only the first amended and second amended complaints in the record.
BOA and the other answering defendants filed cross-claims against each other, seeking indemnification. In Freehold's answer, it asserted it was immune from liability under the New Jersey Tort Claims Act, N.J.S.A. 59:1-1 to 14-4.
Before Freehold filed its answer, counsel for the New Jersey Intergovernmental Insurance Fund (NJIIF), of which Freehold was a member, demanded that plaintiff voluntarily dismiss the complaint. He asserted that Freehold had no responsibility for the location, and was immune from liability. Counsel warned that if plaintiff did not dismiss the claim against Freehold, it would seek sanctions under Rule 1:4-8 and N.J.S.A. 2A:15-59.1.
After plaintiff served his expert report, Freehold renewed its demand that plaintiff dismiss his claim. The expert had opined that the inaction of "the property owner, commercial tenant, property management company and/or management of Bank of America" was "the direct cause" of plaintiff's accident. Freehold asserted that it "had no involvement in the creation of the icing condition or in the maintenance of this sidewalk," and again contended it had no responsibility for the location and it was immune from liability.
Counsel for plaintiff and Freehold thereafter debated, in an email exchange, the viability of plaintiff's claim against the municipality. Plaintiff asserted that the sidewalk was on a borough street, which Freehold's counsel ultimately did not contest. Freehold's counsel asserted that the depression in the sidewalk and the icy condition of the sidewalk were caused by a defect in the BOA building, and it was the duty of the commercial tenant to keep the adjoining sidewalk in reasonably safe condition.
Plaintiff's counsel responded that plaintiff's claim against Freehold was based on the borough's failure to address the depression in the sidewalk, not the spillage of water or failure to remove ice. Plaintiff's counsel asked for authority that addressed that situation. Freehold's attorney did not provide any.
Plaintiff's attorney also asserted that he would be willing to dismiss his client's complaint against Freehold if Freehold also obtained a dismissal from BOA. Plaintiff's counsel stated he was concerned that if plaintiff alone dismissed his claim against Freehold, and the case went to trial, BOA could utilize an "empty chair" defense. There is no evidence in the record that Freehold requested that the other defendants dismiss their cross-claims.
The parties participated in non-binding arbitration, which resulted in a proposed allocation of liability as follows: BOA, fifty percent; the property manager, forty percent; plaintiff, ten percent; and Freehold and the cleaning company, zero percent. The arbitrator found that plaintiff suffered gross damages of $300,000.
Freehold moved for summary judgment dismissal of the complaint and cross-claims against it. The other defendants filed an opposing brief. Plaintiff opposed the motion by adopting the defendants' brief.
Before the return date of the motion, plaintiff reached a settlement with the non-Freehold defendants. They thereafter withdrew their opposition to Freehold's motion. Plaintiff continued to oppose the motion. However, the trial court declined to consider plaintiff's opposition in light of the other defendants' withdrawal of their opposition, and granted the motion as unopposed.
Neither the settlement agreement nor the stipulation of dismissal is included in the record. However, the trial judge noted that BOA and the management company settled the case for $210,000.
In denying plaintiff's subsequent motion for reconsideration, the court held that once BOA withdrew its opposition, "plaintiff could not utilize" its arguments as his own to oppose the motion.
Freehold then filed its motion for sanctions, which Judge Thomas F. Scully denied. The judge explained:
Plaintiff also cross-moved for sanctions, which the court denied.
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[P]laintiff's complaint was not without a reasonable basis in law.
Although the plaintiff's liability expert opined that Bank of America was the direct cause of the accident, the expert also stated the leak and depression were long standing conditions that could have been detected before the incident. Therefore, it was still possible at the time for the defendant to be found partially liable for the depression in the sidewalk.
Freehold appeals and argues that there was no reasonable basis in law and fact for plaintiff's claim against it, and the trial court abused its discretion in denying Freehold's sanctions motion.
II.
Rule 1:4-8 authorizes the court to sanction an attorney, by the award of fees incurred by his adversary in defense of a claim, when "no rational argument can be advanced in its support, or it is not supported by credible evidence, or it is completely untenable." In re Estate of Ehrlich, 427 N.J. Super. 64, 77 (App. Div. 2012) (internal quotation marks and citation omitted), certif. denied, 213 N.J. 46 (2013). An award of fees under the rule is inappropriate "[w]here a party has a reasonable and good faith belief in the claims being asserted." Ibid.
We apply an abuse-of-discretion standard of review to a trial court's decision on a motion for attorneys' fees under Rule 1:4-8. Masone v. Levine, 382 N.J. Super. 181, 193 (App. Div. 2005); see also Ferolito v. Park Hill Ass'n, 408 N.J. Super. 401, 407 (App. Div.), certif. denied, 200 N.J. 502 (2009). "[A]buse of discretion is demonstrated if the discretionary act was not premised upon consideration of all relevant factors, was based upon consideration of irrelevant or inappropriate factors, or amounts to a clear error in judgment." Masone, supra, 382 N.J. Super. at 193 (quoting Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561, 571 (2002)).
We also concur with those federal courts, interpreting Fed.R.Civ.P. 11, which hold "a court's determination is accorded extraordinary deference when it has decided to deny sanctions." Lichtenstein v. Consol. Servs. Grp., Inc., 173 F.3d 17, 22 (1st Cir. 1999) (internal quotation marks and citation omitted). We do so because the award of sanctions under Rule 1:4-8 is in derogation of our general policy disfavoring the shifting of attorneys' fees. See Litton Indus., Inc. v. IMO Indus., Inc., 200 N.J. 372, 386 (2009) ("In general, New Jersey disfavors the shifting of attorneys' fees."); N. Bergen Rex Transport, Inc. v. Trailer Leasing Co., 158 N.J. 561, 569 (1999) ("New Jersey has a strong policy disfavoring shifting of attorneys' fees."). We approach fee-shifting requests under Rule 1:4-8 restrictively, because "while baseless litigation will be deterred, 'the right of access to the court should not be unduly infringed upon, honest and creative advocacy should not be discouraged, and the salutary policy of the litigants bearing, in the main, their own litigation costs, should not be abandoned.'" Gooch v. Choice Entertaining Corp., 355 N.J. Super. 14, 18 (App. Div. 2002) (quoting Iannone v. McHale, 245 N.J. Super. 17, 28 (App. Div. 1990)) (applying N.J.S.A. 2A:15-59.1).
Applying this deferential standard of review, we discern no basis to disturb Judge Scully's decision. With respect to the merits of plaintiff's underlying claim against the borough, we are unpersuaded by Freehold's argument that it was, in essence, absolutely immune from suit, and there was no basis in law or fact for plaintiff's claim.
Plaintiff's claim was grounded in N.J.S.A. 59:4-2, which subjects a public entity to liability for an injury caused by a dangerous condition if the plaintiff establishes: (1) "the property was in dangerous condition at the time of the injury"; (2) "the injury was proximately caused by the dangerous condition"; (3) "the dangerous condition created a reasonably foreseeable risk of the kind of injury which was incurred"; and (4) either (a) the dangerous condition was caused by the negligence, omission or wrongful act of a public employee acting within the scope of his employment or (b) the "public entity had actual or constructive notice of the dangerous condition . . . a sufficient time prior to the injury to have taken measures to protect against the dangerous condition."
However, in no event is the public entity liable for a dangerous condition "if the action the entity took to protect against the condition or the failure to take such action was not palpably unreasonable." Ibid. A public entity has "constructive notice" "only if the plaintiff establishes that the condition had existed for such a period of time and was of such an obvious nature that the public entity, in the exercise of due care, should have discovered the condition and its dangerous character." N.J.S.A. 59:4-3.
Plaintiff argued not that a Freehold employee caused the depression in the sidewalk, but that the borough had constructive and sufficient notice of the depression to have taken protective measures, and its failure to do so was palpably unreasonable. Plaintiff's expert asserted that the depression in the public sidewalk was longstanding. Thus, it was not untenable to assert that municipal employees would have noticed its presence and the risk it posed.
Unquestionably, the "palpably unreasonable" standard is demanding. See, e.g. Holloway v. State, 125 N.J. 386, 403-04 (1991) (stating that to demonstrate palpably unreasonable conduct, "it must be manifest and obvious that no prudent person would approve of its course of action or inaction") (internal quotation marks and citation omitted). Nonetheless, the issue is ordinarily a fact issue for the jury. Polzo v. Cnty. of Essex, 209 N.J. 51, 75 n.12 (2012).
Freehold has apparently abandoned its argument that plaintiff's claim was frivolous because the sidewalk was not on a borough street. Rather, Freehold invokes several statutory and common law immunities, which, if satisfied, would overcome a public entity's liability under N.J.S.A. 59:4-2. See Rochinsky v. State, Dep't of Transp., 110 N.J. 399, 410 (1988). However, the case for none was so clear as to render plaintiff's claim indisputably frivolous and sanctionable.
Freehold claimed the protection of weather immunity under N.J.S.A. 59:4-7 (stating a public entity is not liable "for an injury caused solely by the effect on the use of streets and highways of weather conditions"). However, immunity under N.J.S.A. 59:4-7 does not apply to injuries occurring on a sidewalk. Luchejko v. City of Hoboken, 414 N.J. Super. 302, 316 (App. Div. 2010), aff'd, 207 N.J. 191 (2011). Moreover, plaintiff asserted that weather was not the sole cause of the injury; rather it was a combination of the weather, the failure of BOA to control the flow of water, and the uncorrected depression in the public sidewalk. See Rochinsky, supra, 110 N.J. 410-11 (stating N.J.S.A. 59:4-7 "does not apply in cases where injuries are allegedly caused by a combination of the weather and other factors"); McGowan v. Borough of Eatontown, 151 N.J. Super. 440, 449 (App. Div. 1977 ) (reversing grant of summary judgment to State because plaintiff was entitled to show that icy road condition resulted in part from "non-immunized causes, such as negligent construction").
The common law immunity governing snow removal activities also survived enactment of the Tort Claims Act (TCA). Rochinsky, supra, 110 N.J. at 402. However, plaintiff did not allege Freehold was negligent in failing to remove the ice from the sidewalk; plaintiff alleged Freehold was negligent in allowing the depression to remain unabated.
Finally, Freehold also misplaces reliance on Stewart v. 104 Wallace Street, Inc., 87 N.J. 146 (1981), which established that commercial property owners are liable for injuries sustained on sidewalks abutting their property. In Norris v. Borough of Leonia, 160 N.J. 427, 446 (1999), the Court held that "common law municipal immunity for dangerous conditions applicable to sidewalks is inconsistent with the principles underpinning the TCA." The Court therefore held the traditional municipal immunity was abrogated. Ibid. The commercial owner's liability was not necessarily exclusive of potential liability of the public entity. See Monaco v. Hartz Mt. Corp., 178 N.J. 401, 420 (2004) (holding that if a jury found both the city and commercial landowner breached their duty of care, "it will be required to grapple with concepts of concurrent negligence.")
We need not decide the precise scope of Freehold's potential liability under these principles of law. It is sufficient to conclude plaintiff's claim against Freehold was not so clearly lacking in legal or factual support that the trial court was compelled to sanction plaintiff for pursuing it. Freehold's remaining arguments lack sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION