NEW JERSEY LAWYER

DAILY BRIEFING      11/01/2005


News Briefs

IN ADS, NO BADMOUTHING COPS OR PROSECUTORS
Playing to potential clients’ fears and misperceptions of the justice system is out-of-bounds for law firms’ mail solicitations, according to a strongly worded joint opinion from the New Jersey Supreme Court’s committees on Professional Ethics and Attorney Advertising. Ethics committee members reviewed several letters, such as a pitch for hiring the firm “so you can avoid being taken advantage of by police and prosecutors.” Another states, “You should be aware that the State of New Jersey is represented by a prosecutor and their job is to find you guilty.” Members of the ethics panel called such statements “sweeping” and “baseless” and for attorneys to present such distortions is “prejudicial to the administration of justice within the meaning of Rule of Professional Conduct 8.4(d).” They also said such letters violated attorney advertising Opinion 29 (revised), which prohibits misstating the role of a prosecutor or exaggerating what could happen in court. The findings were recorded in Opinion 698 of the Advisory Committee on Professional Ethics and Opinion 34 of the Committee on Attorney Advertising. 10-31-05

CIVIL LEGAL HELP FOR THE POOR FALLS SHORT IN NEW JERSEY
Ninety-nine percent of litigants in landlord-tenant cases don’t have a lawyer, and indigent tenants are involved in most of those cases, reports Legal Services of New Jersey, which called such statistics “stunning.” In its report “People Without Lawyers: The Continuing Justice Gap in New Jersey,” Legal Services notes it had to turn away half of income-eligible people who applied for help. It said the agency clearly needs more funding to help poor people with civil litigation. New Jersey State Bar Association President Stuart A. Hoberman made a pitch for more voluntary pro bono, noting, “Legal disputes typically are too complex for most people to succeed without the help of a lawyer.” 10-31-05

TWO RETIRED JUDGES SAY KPMG SETTLEMENT TALKS WERE FAIR
It doesn’t happen very often that judges become witnesses, but former U.S. District Judge Nicholas H. Politan of Newark and former California state court Judge Daniel H. Weinstein recently testified before U.S. District Judge Dennis M. Cavanaugh in Newark. They said settlement talks they helped mediate between the accounting firm KPMG and lawyers for wealthy taxpayers who bought tax shelters from KPMG were conducted at arm’s length and were fair. The attorney for several purchasers of the tax shelters has asked Cavanaugh to reject a proposed $225 million settlement for 275 buyers. Of that money, plaintiffs’ law firm, New York-based Milberg Weiss Bershad & Schulman, would get $30 million. Asked if there had been collusion between KPMG and Milberg Weiss, Politan and Weinstein said no. The IRS has determined the tax shelters were improper. 10-31-05

HOUSE JUDICIARY OKS SAN FRANCISCO CIRCUIT SPLIT
The House Judiciary Committee has voted to split the nation’s largest and reportedly most liberal circuit in two. San Francisco-based 9th U.S. Circuit Court of Appeals covers nine states with a total population of 54 million people. Legislation would leave California, Hawaii and the Pacific Islands in the 9th Circuit, and a new 12th Circuit would cover Alaska, Washington, Oregon, Idaho, Montana, Nevada and Arizona. Supporters say the split would make administration more efficient; opponents argue the real reason for the split is to shrink the 9th Circuit, which has issued several controversial opinions, such as striking down the recitation of the Pledge of Allegiance in schools. A similar measure passed the House last year, but died in the Senate. 10-31-05

N.Y. JUSTICE KEEPS TEACHING AFTER INDICTMENT
Even though he faces prison if convicted of stealing $500,000 from an elderly relative, suspended New York State Supreme Court Justice Michael Garson is teaching part-time at Kingsborough Community College in Brooklyn, a public institution. “Isn’t the principle ‘innocent until proven guilty’? That’s a good teaching tool for people who want to know how government works,” Garson told the New York Daily News. He’s been an adjunct lecturer at the college since 1994, teaching criminal justice, American politics and government, and business law. His department chairman said Garson always earned good evaluations from students. One of his students from last semester said, “He was a great teacher. Everybody loved him.” 10-31-05



Today's Decision Summaries

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FROM THE NEW JERSEY SUPREME COURT, MONDAY, OCTOBER 31, 2005
NO OPINIONS WERE RELEASED BY THE NEW JERSEY SUPREME COURT ON MONDAY, OCTOBER 31, 2005, AND NO OPINIONS ARE SCHEDULED FOR RELEASE ON TUESDAY, NOVEMBER 1, 2005.


APPROVED FOR PUBLICATION
MEGAN’S LAW
STATE v. LEAHY
Appellate Division, A-5294-03T4, approved for publication October 28, 2005. (9 pages). Facts-on-Call Order No. 92709

In a prosecution for failure to notify law enforcement authorities of a change of address pursuant to Megan’s Law, the State did not have to prove that the defendant failed to provide the required notice to both the municipality in which he formerly had lived and the municipality to which he had moved.

NOT APPROVED FOR PUBLICATION
LAND USE
PERK’S CAFE, LLC v. POINT PLEASANT BEACH BOARD OF ADJUSTMENT
Appellate Division, A-3274-04T1, October 31, 2005, not approved for publication. (8 pages). Facts-on-Call Order No. 18745

Order dismissing the plaintiff property lessee’s complaint in an action in lieu of prerogative writs and upholding the defendant Board of Adjustment’s denial of the plaintiff’s application for a use variance affirmed substantially for the reasons expressed by the trial court; the plaintiff applied for the variance to turn the parking lot of a restaurant on the premises into a pay parking lot that would be used by the public from 2 p.m. to midnight after the restaurant closed for the day; in denying the application, the Board’s concerns included (1) the inconsequential impact on the area’s parking problem that the nonconforming use in the residential neighborhood would have due to the proposed small number of parking spaces and (2) the potential confusion to motorists because, unlike other parking lots in the area, the proposed lot would be available for parking only after 2 p.m.; the trial court concluded that the Board’s decision was not arbitrary, capricious, or unreasonable after finding, among other things, that under the circumstances of this case the Board’s prior approval of similar pay parking lots in other areas of the municipality was not a basis for reversing the Board’s decision.

DAMAGES
O’HARA v. RISPOLI
Appellate Division, A-2925-04T1, October 31, 2005, not approved for publication. (20 pages). Facts-on-Call Order No. 18747

Dismissal after a bench trial of the plaintiff lenders’ claim for punitive damages against the defendant borrower affirmed; in June 2002, the plaintiffs loaned the defendant, a long-time friend, $40,000 to buy a car, which they held pending full repayment; the defendant failed to make a $20,000 payment due on the loan in August 2002 and removed the car from the plaintiffs’ premises in November 2002 without paying off the loan; the plaintiffs returned a $44,400 check from the defendant in December 2002 and later filed this action; based on N.J.S.A. 2A:15-5.12, which governs the award of punitive damages, the trial court’s conclusion that the defendant’s actions did not constitute “actual malice” or “wanton and willful disregard” could not be overturned because, among other things, (1) there was “a very low likelihood” of harm from the defendant’s conduct and (2) the harm arising from the taking of the car was no different than the harm from the defendant’s prior loan defaults; moreover, even if there was a conversion, the defendant’s actions did not indicate an “evil motive” or a “malicious desire” to harm the plaintiffs.

COMMERCIAL TRANSACTIONS
SAEILO MACHINERY (USA), INC. v. ANTY TRUCKING, INC.
Appellate Division, A-6749-03T1, October 31, 2005, not approved for publication. (7 pages). Facts-on-Call Order No. 18744

Judgment for the plaintiff machine importer after a bench trial in an action arising from the defendant trucking company’s sale of a machine belonging to the plaintiff affirmed; pursuant to the parties’ ordinary practice, the defendant held the machine pending shipment to the plaintiff’s customer, but the customer lost financing; after holding the machine for “a substantial period of time,” the defendant sold it at auction; the issuance of a warehouse receipt to the plaintiff would have given the defendant a security interest in the machine under the Uniform Commercial Code to authorize the sale, but the trial court found that a conversion had occurred because the purported warehouse receipt had been altered and had not been issued to the plaintiff; contrary to the defendant’s arguments on appeal, the trial court did not err (1) by finding that the receipt had been altered, even though it had found earlier that the defendant had provided sufficient authentication for the receipt to be admitted into evidence, and (2) by failing to find that the plaintiff had breached its duty to mitigate damages.

ESTATES AND TRUSTS
IN RE ESTATE OF REEVE
Appellate Division, A-1290-04T5, October 31, 2005, not approved for publication. (11 pages). Facts-on-Call Order No. 18746

Order of the Probate Part that removed the executor of an estate and that revoked his letters of administration in an action by a residuary beneficiary of the decedent’s will to remove the executor reversed and remanded; in an unrelated matter, the executor was indicted on charges of theft by retaining property that belonged to a trust and the trust beneficiaries and of misapplying the entrusted funds; the residuary beneficiary claimed that the criminal charges involved “the commission of a serious breach of trust”; the record on appeal was “inadequate” for “a meaningful review” because there was no evidence of a breach of any duty by the executor in this case or that his conduct supported his removal; the indictment alone did not constitute a breach of a fiduciary duty because an indictment is not the equivalent of a conviction and therefore has no probative or evidentiary value; the matter was remanded for a plenary hearing on whether the executor fulfilled the obligations of his position or whether there was cause to remove him.

ATTORNEY’S FEES
KAMDEN v. LIEBLICH
Appellate Division, A-3226-04T1, October 28, 2005, not approved for publication. (8 pages). Facts-on-Call Order No. 18741

Denial of the plaintiff buyer’s motion for attorney’s fees under Rule 4:58 based on his offer of judgment in an action arising from his cancellation of a contract to purchase residential real estate affirmed; the complaint sought the return of the $33,500 deposit and consequential and punitive damages, and the plaintiff filed an offer of judgment for $30,000; after he was awarded $33,500 in mandatory nonbinding contract-dispute arbitration under Rule 4:21A-1(a)(3), the plaintiff accepted the defendant sellers’ counteroffer of judgment for $33,500, and his complaint was administratively dismissed for failure to comply with Rule 4:21A-6(b); the plaintiff was not entitled to attorney’s fees under Rule 4:58 (1) because his acceptance of the defendant’s counteroffer constituted a withdrawal of his offer, (2) because he had sought unliquidated damages but had not accepted an amount that exceeded 120 percent of his offer, and (3) because he had not obtained a favorable “verdict or determination.”

CONTRACTS
BLUM v. IMPORTED CARS OF OCEAN, INC.
Appellate Division, A-1796-04T5, October 28, 2005, not approved for publication. (11 pages). Facts-on-Call Order No. 18740

Special Civil Part judgment for the plaintiff after a bench trial in an action arising from her purchase of a new vehicle from the defendant dealership affirmed; the parties’ original contract indicated a balance due of $36,138.50, but the plaintiff was informed when she returned to take delivery of the vehicle that the original contract price “inadvertently” omitted sales tax that she had to pay; the plaintiff paid $38,170.33 “under protest” on a second contract, and she sued to recover the $2,031.83 difference between the contract prices; the Special Civil Part accepted the plaintiff’s version of events, including her claim that the dealership’s salesperson had stated that sales tax was included in the original contract price; contrary to the dealership’s arguments on appeal, the Special Civil Part did not err (1) by not requiring the plaintiff to pay the sales tax under the original contract because the contract was ambiguous, (2) by considering parol evidence to establish the parties’ course of dealing, and (3) by not enforcing the second contract because any mistake was unilateral on the part of the dealership.

PUBLIC EMPLOYEES
IN RE CZAJKOWSKI
Appellate Division, A-3141-04T2, October 28, 2005, not approved for publication. (7 pages). Facts-on-Call Order No. 18743

Final decision of the Merit System Board that imposed a three-month suspension and a $1,685 fine on the appellant construction and maintenance technician for the Department of Transportation affirmed; after a motor vehicle accident involving his State vehicle, the Board found that the technician had left his assigned work area without permission, had used his State vehicle for unauthorized personal business, had made false statements to investigators, and had intentionally falsified records; the technician challenged only the length of his suspension; the Board properly considered the technician’s lack of prior disciplinary infractions during his 21 years of employment, but the record supported the Board’s departure from its policy of progressive discipline because the technician’s actions constituted a breach of the public trust that justified the penalty imposed.

HUSBAND AND WIFE
SOBE v. SOBE
Appellate Division, A-394-04T1, October 28, 2005, not approved for publication. (4 pages). Facts-on-Call Order No. 18742

Post-divorce-judgment order that denied the plaintiff ex-husband’s motion for a reduction of his alimony obligation based on changed circumstances reversed and remanded; the parties had negotiated alimony payments of $600 per week in 2001, and the ex-husband sought a reduction after his employment was terminated; the trial court found that the ex-husband’s income from employment had decreased from $87,000 to $51,500 since alimony was negotiated, but it denied his motion because his annual combined income from employment and from his pension was about 95 percent of the amount on which the alimony award had been based; the trial court erred as a matter of law because the pension had been equitably distributed and because income from the pension therefore could not be considered under N.J.S.A. 2A:34-23(b)(13) to determine alimony.

CIVIL PROCEDURE
LUCENT TECHNOLOGIES GRL L.L.C. v. THINKFIRE SERVICES USA, LTD.
Chancery Division, Union County, UNN-C-121-05, September 30, 2005, released October 18, 2005, not approved for publication. By Lyons, P.J. (20 pages). Facts-on-Call Order No. 18734

Action to vacate in part an arbitrator’s decision dismissed without prejudice on grounds of comity; the arbitrator’s decision was rendered under the parties’ patent-licensing services agreement, which provided that disputes would be arbitrated in New York and that New York law governed the agreement, even though New Jersey was where the agreement was executed, where the defendant had performed under the agreement, and where the parties had collaborated in furtherance of the agreement; the plaintiffs filed a verified complaint on the same day in New Jersey and in New York challenging the arbitrator’s decision; although the Chancery Division concluded that it had subject-matter jurisdiction over the action, it declined to hear the matter out of respect for New York and the “strong public policy in favor of marshalling judicial resources” after it concluded, under Bass v. Dewink, that the three prerequisites for comity abstention were present and that there were no “special equities” that required a New Jersey court to hear the case.

ARBITRATION
CIOTTO v. DONATO
Law Division, Atlantic and Cape May Counties, ATL-L-2892-04, return date October 7, 2005, released October 12, 2005, not approved for publication. By Higbee, P.J. (4 pages). Facts-on-Call Order No. 18729

The plaintiff’s cross-motion to set aside the arbitration award in favor of the defendant and for a trial de novo granted; under Rule 4:21A-6(b), the parties had 30 days from the date of the arbitration award, or until September 12, 2005, to file a demand for a trial de novo; on September 9, the plaintiff’s attorney sent a notice of demand for a trial de novo to the Atlantic County Civil Case Manager by a commercial carrier for delivery on the next business day, which was September 12; the demand was delivered on September 13 and was “file stamped” on that date; the carrier’s failure to deliver the plaintiff’s demand before the statutory deadline constituted “exceptional circumstances” under which a party may be allowed to file a late demand for a trial de novo (1) because the late filing did not result from attorney carelessness and (2) because, due to the well-established “general reliability” of commercial carrier services, the plaintiff was entitled to rely on the carrier’s “next-day” service.

REAL PROPERTY
WACHOVIA BANK v. THE GADBEY ORGANISATION
Law Division, Somerset County, SOM-L-673-04, October 5, 2005, released October 12, 2005, not approved for publication. By Reed, J. (30 pages). Facts-on-Call Order No. 18733

Judgment granted to the defendant seller on the plaintiff bank’s complaint for the return of the bank’s deposit and on the seller’s counterclaim for breach of a real estate contract; the bank agreed to buy commercial real estate from the seller for the construction of a banking facility; several months later, the bank ceased its efforts to obtain the necessary approvals and permits because it believed that its efforts would be fruitless; the bank tried to terminate the contract and to have its deposit returned, but the seller resisted; the preponderance of the credible evidence at trial established that a State access permit required for the development was a matter that fell within the 60-day inspection-contingency period under the contract and that it was not “objectively impossible” for the bank to obtain the permit; the bank’s “subjective perception” that it would be useless to prosecute its development application did “not relieve it from its contractual responsibilities under the doctrine of impossibility”; under the contract, the seller was entitled to the deposit as liquidated damages and to fees and costs as the prevailing party.


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