Opinion
DOCKET NO. A-5502-14T1
01-18-2017
ROGER A. WEST, JR., d/b/a 527 CYCLES SALVAGE, f/k/a 527 CYCLE, INC., Plaintiff-Respondent, v. SUNSHINE VENTURES, INC., Defendant-Appellant, and LAUREN EGIERD, a/k/a LAUREN VANDZUTAN, AND MICHAEL EGIERD, Defendants.
Richard Lupo, L.L.C., attorneys for appellant (Michael Wiseberg, on the brief). Heilbrunn Pape, L.L.C., attorneys for respondent (Steven Kropf, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R.1:36-3. Before Judges O'Connor and Whipple. On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-4892-11. Richard Lupo, L.L.C., attorneys for appellant (Michael Wiseberg, on the brief). Heilbrunn Pape, L.L.C., attorneys for respondent (Steven Kropf, on the brief). PER CURIAM
Defendant, Sunshine Ventures, Inc., appeals from a July 16, 2015 judgment in favor of plaintiff, Roger A. West, Jr. d/b/a 427 Cycles Salvage, in the amount of $5000 based on an offer of judgment made by defendant, which had been accepted by plaintiff six days before trial. Defendant asserts the offer of judgment was withdrawn, pursuant to Rule 4:58-1(b), ten days before trial, and the trial court did not weigh the competing interests prior to applying Rule 1:1-2 to relax the time limitation. We agree. Accordingly, we reverse the judge's decision, vacate the judgment, and remand for further proceedings consistent with our opinion.
Defendant and plaintiff entered into an agreement to operate a snow removal business, contracting with the New Jersey Department of Transportation (DOT), beginning in the winter of 2010. The agreement provided the parties would equally split all profits from the DOT contracts, even though the contracts were entered by defendant. Payments were issued to defendant, which was authorized to first satisfy cost incurred for insurance, wages for the plow drivers, gasoline, and other costs associated with the trucks. The balance would be divided between the parties. Defendant maintains plaintiff's action sought "profits that simply do not exist," but plaintiff asserts the issue is not settled and would have had to be determined had the parties gone to trial.
Among other claims, plaintiff's complaint, filed on July 6, 2011, also sought payment of $5850, from Lauren and Michael Egierd for snow removal services performed by plaintiff. Lauren Egierd is the president of defendant and Michael Egierd is an employee.
An answer and counterclaim was filed on behalf of defendant and the Egierds. Plaintiff's claims were denied and the counterclaim asserted plaintiff misused defendant's assets, harassment, and failing to perform work under the agreement.
Michael Egierd was voluntarily dismissed from the suit after filing a bankruptcy petition, and the case was not restored to the active trial list until February 14, 2014. In June 2015, the court set the trial date for June 29, 2015.
On June 3, 2015, defendant and Lauren Egierd filed and served upon plaintiff a joint offer of judgment in the amount of $5000. Pursuant to Rule 4:58-1(b), plaintiff had to accept the offer within ten days before the scheduled trial. Plaintiff voluntarily dismissed Lauren Egierd from the suit on June 10, 2015. Also on June 10, 2015, plaintiff wrote to inform the trial judge it had subpoenaed billing records from DOT, defendant had scheduled a deposition, and if the parties did not resolve the matter, they would appear on June 24, 2015, for a settlement conference.
A June 18, 2015 letter from the DOT stated the subpoenaed billing records were sent to plaintiff; however, plaintiff did not receive those records until June 22, 2015. On June 23, 2015, plaintiff's counsel sent an email to defendant's counsel accepting defendant's June 3 offer of judgment, pursuant to Rule 4:58-1(b). Defendant's counsel informed plaintiff the offer of judgment was no longer available because the time to accept had expired.
On June 29, 2015, plaintiff moved in limine to enforce the offer of judgment and the trial judge heard oral argument. The trial court enforced plaintiff's June 23 acceptance of the offer of judgment, by enlarging the time to accept the offer by an additional ten days. Defendant argued this was not a just result as defendant had prepared to go to trial. The trial court found plaintiff's acceptance valid under Rule 4:58, as modified by Rule 1:3-4(a), as it ensured "everybody leaves here with a just result." The trial court rejected defendant's argument and on July 16, 2015, entered judgment for plaintiff in the amount of $5000, and denied defendant's request to accept the offer of judgment solely on plaintiff's complaint and not on defendant's counterclaim. This appeal followed.
We review a trial court's "legal determinations based on an interpretation of our court rules de novo." Occhifinto v. Olivo Constr. Co., LLC., 221 N.J. 443, 453 (2015) (citing State ex rel. A.B., 219 N.J. 542, 554-55 (2014)).
Defendant argues relaxing Rule 4:58 was error because the trial court did not conduct the required balancing test to determine whether enforcement of the offer of judgment would avoid any injustice or create an injustice for defendant. We agree.
Rule 4:58-1(b) states if an offer of judgment is
not accepted on or prior to the 10th day before the actual trial date or within 90 days of its service, whichever period first expires, it shall be deemed withdrawn and evidence thereof shall not be admissible except in a proceeding after the trial to fix costs, interest, and attorney's fee.
Rule 1:3-4(a) states "[u]nless otherwise expressly provided by rule, a period of time thereby fixed for the doing of an act may be enlarged before or after its expiration by court order on notice" or by consent. Section (c) includes various enlargements that are prohibited but does not prohibit an enlargement under Rule 4:58-1. See R. 1:3-4(c). The rule requires a motion for extension of time "to be on notice and to be determined on the merits of the application." Pressler & Verniero, Current N.J. Court Rules, cmt. 1 on R. 1:3-4 (2017). A court is to consider the reasons for the delay, prejudice to opposing parties, and the effect to the trial calendar. Ibid. Rule 1:3-4 is to be read in accordance with Rule 1:1-2 and allows relaxation of time periods "in order to avoid injustice." Ibid.
Rule 1:1-2(a) is considered the catch-all provision as it allows for the general relaxation of New Jersey court rules. Rule 1:1-2(a) states the following:
The rules in Part I through Part VIII, inclusive, shall be construed to secure a just determination, simplicity in procedure, fairness in administration and the elimination of unjustifiable expense and delay. Unless otherwise stated, any rule may be relaxed or dispensed with by the court in which the action is pending if adherence to it would result in an injustice.
In Romagnola v. Gillespie, 194 N.J. 596 (2008), the New Jersey Supreme Court explained the proper circumstances for applying Rule 1:1-2 to relax the newly amended Rule 4:58-2. Id. at 604. Choosing to relax the rule, the Court warned how sparingly the relaxation rule should be invoked. Ibid. In Romagnola, a change in the rule during the proceedings was a unique circumstance that demonstrated the need for the flexible approach of Rule 1:1-2. Id. at 606. The Court "further explained that '[d]etermining whether relaxation is appropriate . . . requires an examination and balancing of the interests that are at stake.'" Id. at 605 (quoting State v. Williams, 184 N.J. 432, 443 (2005)). Rule 1:1-2 does not provide a "safe harbor for the dilatory," and those who seek relief under the rule "bear a heavy burden" because the relief is only granted sparingly "after an appropriate weighing of all relevant factors." Id. at 606.
Here, the trial court noted no specific injustice to plaintiff to justify the relaxation of Rule 4:58-1(b) other than plaintiff was two business days late and was waiting for DOT billing records before attempting to communicate acceptance of the offer. The trial court's analysis does not reflect the heavy burden needed to relax the rule, nor the appropriate weighing of all the factors. See ibid. In relaxing the rule, the court merely noted it "is not fair to the plaintiff," to embrace the time limit against him without any consideration for the time defendant expended to prepare for trial.
The record does not establish this is an exceptional case, as was shown in Romagnola, requiring the need to relax our court rules in order to avoid an injustice. The record does not reflect, as required by Rule 1:1-2, how the adherence to Rule 4:58-1(b) would create an injustice, and the record fails to demonstrate how a trial would have prevented a "just determination, simplicity in procedure, fairness in administration and the elimination of unjustifiable expense and delay." R. 1:1-2.
For these reasons we reverse the judge's determination and vacate the July 16, 2015 judgment. We remand the matter to the trial court to weigh and balance all relevant considerations consistent with this opinion. A final determination shall be completed within sixty days. We 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