NEW JERSEY LAWYER

DAILY BRIEFING      01/26/2005


News Briefs

JUDGES, TOO, TAKE THE LOBBYING ROUTE
Frustrated by the legislature’s failure to pass a measure that would bring their pensions in line with what other state judges receive, the Association of New Jersey Administrative Law Judges has done what other groups do when they want to influence lawmakers — hire a lobbyist. Judge Douglas H. Hurd, association president, said the group used its own money to hire Public Strategies Impact, the Trenton lobbying firm run by well-connected Democrat Harold Hodes, an informal adviser to acting Gov. Richard Codey. There’s nothing in conflict-of-interest codes to prevent the executive-branch judges from hiring an advocate, said Rita Strmensky, executive director of the state’s Executive Commission on Ethical Standards. 1-25-05

REIMBURSEMENT PAYMENTS NOT TAXES, SAYS 3RD CIRCUIT
A nonprofit organization’s obligation to reimburse the N.J. Department of Labor (DOL) for unemployment compensation benefits paid to the nonprofit’s former employees is not an “excise tax” under the Bankruptcy Code, ruled the 3rd U.S. Circuit Court of Appeals. Due to its non-profit status, United Healthcare System was entitled under New Jersey law to reimburse DOL retroactively for benefits actually paid, rather than making the quarterly unemployment contribution payments required of most employers in the state. United Healthcare filed for bankruptcy, and DOL contended its claim for reimbursement merited priority under a federal law granting such priority to claims for excise taxes. Reversing bankruptcy court and district court decisions, the appeals court found that “rather than a tax, the reimbursement obligation is more like a promise in exchange for the privilege of employing individuals in the state without being required to pay state unemployment compensation contributions.” Therefore, it “cannot be classified as excise taxes entitled to priority,” wrote senior Circuit Judge Morton I. Greenberg for the 2-1 majority. The matter was argued by Morristown attorney Dennis J. O’Grady for United and Assistant Attorney General Mala S. Narayanan for DOL. (A full text of In re United Healthcare System v. State of New Jersey Department of Labor, Facts-on-Call Order No. 92276, can be ordered from NJL Online or by calling 800-670-3370.) 1-25-05

CONSTRUCTION LAW GROUP JOINS MCCARTER & ENGLISH IN NEW YORK
The six-partner Construction Industry Practice Group, whose recent projects involved the Museum of Modern Art, the World Trade Center litigation and Hartford’s Wadsworth Atheneum, has joined the New York office of McCarter & English. “We and our clients will benefit from their unsurpassed expertise,” said Lois M. Van Deusen, managing partner of McCarter & English. “Their arrival marks another important step in the firm’s strategic growth plan,” added Van Deusen of the firm’s Newark office. The state’s largest firm has more than 350 lawyers in seven cities in the Northeast. The new group will counsel owners, developers, architects and engineers, contractors, project managers, manufacturers and others on a wide variety of matters including construction litigation, contract drafting and negotiation, mergers and acquisitions, and troubled projects. 1-25-05

JUDGES TO PRESIDE AT MOCK TRIAL COMPETITIONS
More than three dozen Superior Court judges statewide will participate in the New Jersey State Bar Foundation’s mock trial competition for high school students, sponsored by the 21 county bar associations. The program, now in its 23rd year, has “helped thousands of New Jersey students learn about the legal system while honing their public speaking skills, building teamwork, and developing an enthusiasm for learning,” said Judge Philip S. Carchman, administrative director of the courts. Regional competitions will be held next month at the New Jersey Law Center in New Brunswick, followed by statewide semi-finals March 7. 1-25-05

HE HAS GOOD HEAD FOR BUSINESS
Andrew Fischer, a web page designer who auctioned off his forehead for advertising space on e-Bay, will receive $37,375 to advertise SnoreStop, a snoring remedy. Fischer, described by SnoreStop CEO Christian de Rivel as “a man who clearly has a head for business in every sense of the word,” will display the product’s logo on his forehead for one month. Anyone want to bid for the following month? 1-25-05



Today's Decision Summaries

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FROM THE NEW JERSEY SUPREME COURT, TUESDAY, JANUARY 25, 2005
THE FOLLOWING OPINION WAS RELEASED BY THE NEW JERSEY SUPREME COURT ON TUESDAY, JANUARY 25, 2005:

CONTRACTS
BRUNSWICK HILLS RACQUET CLUB, INC. v. ROUTE 18 SHOPPING CENTER ASSOCIATES
New Jersey Supreme Court, A-86, January 25, 2005. (33 pages). Facts-on-Call Order No. 92274

Under the circumstances of this case, the defendant landlord breached the covenant of good faith and fair dealing through a series of evasions and delays that lulled the plaintiff tenant into believing that it had properly exercised the option provision in the lease, and the plaintiff was entitled to specific performance of the lease option in accordance with the terms of the contract.

THE SUPREME COURT has announced that it will release opinions in STATE v. JOHNSON, A-7, and STATE v. ROSADO, A-8, on January 26, 2005. The issues on appeal in Johnson address whether the defendant was entitled to withdraw his plea because he was not informed of the mandatory parole term required under the No Early Release Act and whether the defendant’s conviction of possession of a weapon for an unlawful purpose merged into the aggravated assault convictions. The issue on appeal in Rosado addresses whether the defendant was entitled to withdraw his plea because he was not informed of the mandatory parole term required under the No Early Release Act.



APPROVED FOR PUBLICATION
PROFESSIONAL MALPRACTICE
DIOCESE OF METUCHEN v. PRISCO & EDWARDS, AIA
Appellate Division, A-4139-03T2, approved for publication January 25, 2005. (15 pages). Facts-on-Call Order No. 92275

In construction litigation, the defendant architect was not required to serve an affidavit of merit on the consultants against which it had asserted third-party claims for contribution or indemnification and joint tortfeasor liability because the third-party claims were more like a cross-claim than an affirmative claim for damages and the Affidavit of Merit Statute therefore did not apply.

NOT APPROVED FOR PUBLICATION
TORT CLAIMS ACT
MADSON v. NEW JERSEY TURNPIKE AUTHORITY
Appellate Division, A-2943-03T2, January 25, 2005, not approved for publication. (4 pages). Facts-on-Call Order No. 17548

Order allowing the plaintiff to file a late notice of claim under the Tort Claims Act affirmed; the plaintiff, who was an assistant manager at a gas station in a rest area on the New Jersey Turnpike, was injured when he slipped and fell while working; the plaintiff’s attorney filed a timely notice of claim with the municipality, the New Jersey Department of Law and Public Safety, the Office of the Attorney General, and the County; several weeks after the 90-day period had expired, a claims investigator from the New Jersey Bureau of Risk Management advised the plaintiff’s attorney that the defendant New Jersey Turnpike Authority was a public entity “separate and distinct from the State” and that notice to the State was not notice to the defendant; the plaintiff’s attorney then forwarded a notice to the defendant, which the defendant declined as untimely; the motion judge (1) properly granted the plaintiff’s motion to file a late notice of claim and (2) properly concluded that there had been substantial compliance, that the defendant was not claiming substantial prejudice, and that there were extraordinary circumstances.

HUSBAND AND WIFE
JANELLI v. MAHER
Appellate Division, A-3569-03T5, January 25, 2005, not approved for publication. (5 pages). Facts-on-Call Order No. 17549

Chancery Division decision awarding one-fourth of the proceeds of the employment-related life insurance policy of the plaintiff’s deceased ex-husband to his adult son from a previous marriage reversed in an action by the plaintiff, who was acting as guardian ad litem of her three minor children; the Chancery Division erred by failing to enforce the provisions of the property settlement agreement that required that the plaintiff’s three children be designated as the sole beneficiaries under the policy; the Chancery Division’s decision was “in direct contravention” of Flanigan v. Munson, which upheld the imposition of a constructive trust to protect the children’s right to receive the proceeds of their mother’s work-related life insurance policy; the PSA was not ambiguous, and the ex-husband could not unilaterally designate additional beneficiaries without express judicial approval.

HUSBAND AND WIFE
CALDWELL v. CALDWELL
Appellate Division, A-3640-03T2, January 25, 2005, not approved for publication. (5 pages). Facts-on-Call Order No. 17546

Judgment of divorce affirmed in part and remanded; contrary to the plaintiff ex-wife’s arguments on appeal, the trial court did not abuse its discretion by determining the defendant ex-husband’s potential earning capacity for purposes of fixing his child support obligation or by awarding the defendant $40,000 to satisfy his equitable distribution claim on the marital home, which the plaintiff had inherited before the marriage and which the defendant had restored, maintained, and repaired; however, remand was required because the trial court (1) failed to consider a lot that the parties had purchased together and the refunds arising from the parties’ unfiled tax returns and (2) might have confused two timeshares in its order.

PARENT AND CHILD
BURG v. BURG
Appellate Division, A-1652-03T3, January 25, 2005, not approved for publication. (13 pages). Facts-on-Call Order No. 17547

Post-divorce-judgment order affirmed as to the payment of prior medical bills by the defendant father but reversed and remanded as to the denial of the defendant father’s motion to reduce his child support obligations based on the status of the parties’ daughter; the daughter graduated from college and began a Ph.D. program that provided tuition and fees, medical insurance, and a $23,000 annual stipend; the trial court’s finding that the daughter was unemancipated was supported by the record, but the trial court erred (1) by denying the defendant’s motion without adequate consideration of the factors relating to his child support obligation because he had established a prima facie case of changed circumstances and (2) by ordering the defendant to maintain health insurance coverage for his daughter.

PARENT AND CHILD
GOWA v. GOWA
Appellate Division, A-2830-03T3, January 24, 2005, not approved for publication. (10 pages). Facts-on-Call Order No. 17544

Post-divorce-judgment order retroactively modifying the defendant ex-husband’s child support obligation reversed and remanded; the Appellate Division vacated the order because there was merit to the plaintiff ex-wife’s assertions (1) that the defendant’s child support obligation had been reduced without current financial information, including a current case information statement, (2) that the order was entered without any findings or reasons in violation of Rule 1:7-4(a), and (3) that the defendant’s child support payments were retroactively reduced in violation of N.J.S.A. 2A:17-56.23a.

PUBLIC EMPLOYMENT
PISCATAWAY TOWNSHIP BOARD OF EDUCATION v. PISCATAWAY TOWNSHIP EDUCATION ASSOCIATION
Appellate Division, A-2435-03T2, January 24, 2005, not approved for publication. (7 pages). Facts-on-Call Order No. 17545

Chancery Division decision holding that the dispute between the plaintiff Board of Education and the defendant union over the effective date of a teacher’s termination was not arbitrable affirmed; because the provisions relating to termination were found only in the employment contract, the dispute rested solely on the parties’ differing interpretations of the employment contract; because the dispute did not arise from any differences about the terms of the collective negotiations agreement, it was not within the scope of the collective negotiations agreement’s arbitration clause.

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