Justia Legal Ethics Opinion SummariesArticles Posted in Supreme Court of New Jersey
Gilbert v. Stewart
In 2006, plaintiff Brenda Gilbert divorced her husband, Monroe Gilbert, who acquired sole possession of the family’s vehicle, which was still registered in plaintiff’s name. In April 2014, Monroe informed plaintiff that he had to report to the Woodland Park Municipal Court (WPMC) regarding many outstanding traffic tickets; the court summonses were issued in plaintiff’s name. On April 15, 2014, plaintiff met Monroe and his attorney, defendant Kenyatta Stewart, at WPMC. The matter was adjourned, and plaintiff, defendant, and Monroe discussed the best way to resolve the outstanding summonses. Plaintiff did not retain defendant as her attorney or request that he represent her; nor did defendant bill plaintiff or enter into a fee agreement with her. Nevertheless, he indicated to plaintiff that the optimal resolution would be for her to plead guilty to the charges because Monroe was at greater risk of license suspension due to his poor driving record. Plaintiff worked in the Passaic probation department since 1994. The parties disputed the extent to which defendant advised plaintiff of certain risks associated with the plea agreement. It was undisputed that defendant failed to advise plaintiff of the impact that a guilty plea might have on her public employment. In July 2014, plaintiff, through different counsel, challenged her conviction; ultimately the disposition against her was vacated, her fines were repaid to her, and the charges against plaintiff were dismissed. Plaintiff ultimately filed a complaint against defendant, alleging he breached a duty of care by “engaging in a clear conflict of interest” and urging her to enter into “unwarranted guilty pleas.” Defendant moved for summary judgment, arguing that he was not the proximate cause of plaintiff’s harm because any discipline from her employer resulted from her failure to notify, not her conviction. Judgment was entered in defendant's favor. The New Jersey Supreme Court reversed, finding a jury should have decided whether defendant’s legal advice was a substantial factor in plaintiff's demotion and suspension. View "Gilbert v. Stewart" on Justia Law
Delaney v. Dickey
At issue in this appeal was whether the arbitration provision in the retainer agreement plaintiff Brian Delaney signed when he engaged the representation of Sills Cummis & Gross P.C. was enforceable in light of the fiduciary responsibility that lawyers owe their clients and the professional obligations imposed on attorneys by the Rules of Professional Conduct (RPCs). In 2015, Delaney, a sophisticated businessman, retained Sills to represent him in a lawsuit. He met with a Sills attorney who presented him with a four-page retainer agreement. It was understood that Trent Dickey was slated to be the attorney primarily responsible for representing Delaney reviewed and signed the retainer agreement in the presence of the Sills attorney without asking any questions. After the representation was terminated, a fee dispute arose and, in August 2016, Sills invoked the JAMS arbitration provision in the retainer agreement. While the arbitration was ongoing, Delaney filed a legal malpractice action against Dickey and the Sills firm. The complaint alleged that Dickey and Sills negligently represented him. The complaint also alleged that the mandatory arbitration provision in the retainer agreement violated the Rules of Professional Conduct and wrongly deprived him of his constitutional right to have a jury decide his legal malpractice action. The trial court held that the retainer agreement’s arbitration provision was valid and enforceable. Additionally, the court determined that Delaney waived his right to trial by jury by agreeing to the unambiguously stated arbitration provision. The Appellate Division disagreed, stressing that Sills should have provided the thirty-three pages of JAMS arbitration rules incorporated into the agreement, that Sills did not explain the costs associated with arbitration, and that the retainer included a fee-shifting provision not permissible under New Jersey law. The New Jersey Supreme Court held that, for an arbitration provision in a retainer agreement to be enforceable, an attorney must generally explain to a client the benefits and disadvantages of arbitrating a prospective dispute between the attorney and client. "Delaney must be allowed to proceed with his malpractice action in the Law Division. We affirm and modify the judgment of the Appellate Division and remand to the Law Division" for further proceedings. View "Delaney v. Dickey" on Justia Law
In the Matter of Carlia M. Brady
The Advisory Committee on Judicial Conduct (ACJC) found by clear and convincing evidence that respondent Carlia Brady, formerly a Judge of the Superior Court, violated Canon 1, Rule 1.1; Canon 2, Rules 2.1 and 2.3(A); and Canon 5, Rule 5.1(A) of the Code of Judicial Conduct (Code). The ACJC unanimously recommended the sanction of removal from judicial office. On June 11, 2013, officers of the Woodbridge Township Police Department (WTPD) arrested respondent at her home in Woodbridge. She was charged in a complaint warrant with hindering the apprehension of another, in violation of N.J.S.A. 2C:29-3, by “knowingly harboring Jason Prontnicki, a known fugitive,” in her residence. Respondent was indicted on three charges: second-degree official misconduct; third-degree hindering apprehension or prosecution; and third-degree hindering apprehension. The trial court granted respondent’s motion to dismiss the official misconduct charge but denied her motion to dismiss the hindering apprehension or prosecution charges. The State appealed the dismissal of the official misconduct charge, and respondent appealed the denial of her motion to dismiss the other charges. The Appellate Division affirmed the trial court’s determinations and remanded the matter to the trial court for further proceedings. The State later moved to dismiss with prejudice the remaining two counts of the indictment. The trial court granted that motion, thus concluding the criminal proceedings against respondent. On March 6, 2018, the New Jersey Supreme Court reinstated respondent to her duties as a Superior Court judge. Several months later, the ACJC issued its complaint. After review, the New Jersey Supreme Court modified the sanction of removal recommended by the ACJC and imposed a three-month suspension on respondent. "We view that sanction to be commensurate with the conduct proven by clear and convincing evidence and to further our disciplinary system’s purpose of preserving public confidence in the judiciary." View "In the Matter of Carlia M. Brady" on Justia Law
In the Matter of John F. Russo, Jr.
A complaint issued by the Advisory Committee on Judicial Conduct (ACJC) alleged four counts of misconduct against a superior court judge, Respondent John Russo, Jr. The charges and findings related to four discrete instances of misconduct. Count I, the most serious matter, concerns Respondent’s conduct at a hearing on an application for a final restraining order. The misconduct charged related to his questioning of an alleged victim of domestic violence who testified that she had been sexually assaulted, as well as his comments to staff members in open court after the hearing. Count II addressed a personal guardianship matter in which Respondent allegedly asked a Judiciary employee to contact her counterpart in another vicinage and request that a hearing be rescheduled to accommodate Respondent. Count III asserted Respondent created the appearance of a conflict of interest when he presided over a matter in the Family Division in which he knew both parties since high school. Count IV related to Respondent’s ex parte communication with an unrepresented litigant. After it conducted a hearing, the ACJC found clear and convincing evidence to support all the charges. A panel of three Judges designated by the Supreme Court then conducted a separate, additional hearing and concluded that the evidence supported a finding beyond a reasonable doubt that Respondent violated the Canons of the Code of Judicial Conduct and the Rules cited in all four counts. The panel recommended that Respondent be removed from office. Based on its review of the extensive record, the New Jersey Supreme Court found beyond a reasonable doubt that there was cause for Respondent’s removal, and ordered such removal. View "In the Matter of John F. Russo, Jr." on Justia Law
Nieves v. Office of the Public Defender
This case arose from the representation of plaintiff Antonio Nieves by a state public defender, Peter Adolf, Esq. After his conviction, Nieves was granted post-conviction relief based on the ineffective assistance of counsel at trial. DNA evidence later confirmed that Nieves was not the perpetrator, and the underlying indictment against him was dismissed. Nieves subsequently recovered damages from the State for the time he spent wrongfully imprisoned. He then filed the present legal malpractice action seeking damages against the Office of the Public Defender (OPD) and Adolf. Defendants moved for summary judgment, arguing that the New Jersey Tort Claims Act (TCA) barred the damages sought because Nieves failed to vault N.J.S.A. 59:9-2(d)’s verbal threshold. The motion court concluded that the TCA and its verbal threshold were inapplicable. The Appellate Division reversed, concluding that “public defenders are public employees that come within the TCA’s immunities and defenses” and that Nieves’s claim fell squarely within the TCA. The Appellate Division also held that plaintiff’s claim for loss of liberty damages fell within the TCA’s limitation on recovery for pain and suffering in N.J.S.A. 59:9-2(d), which Nieves failed to satisfy. The New Jersey Supreme Court concluded the TCA applied to Nieves’s legal malpractice action, and his claim for loss of liberty damages failed to vault the verbal threshold for a pain and suffering damages claim under the strictures of N.J.S.A. 59:9-2(d). Defendants were entitled to summary judgment. View "Nieves v. Office of the Public Defender" on Justia Law
Dimitrakopoulos v. Borrus, Goldin, Foley, Vignuolo, Hyman and Stahl, P.C.
In 2005, Evangelos Dimitrakopoulos retained the law firm of Borrus, Goldin, Foley, Vignuolo, Hyman and Stahl, P.C. ("Borrus firm"), for help with a business dispute with Steven Eleftheriou. Represented by the Borrus firm, Dimitrakopoulos and his wife filed a complaint against Eleftheriou and his wife. For undisclosed reasons, the Borrus firm filed a motion to withdraw as counsel shortly after it was retained. Days later, the Borrus firm filed a complaint against Dimitrakopoulos, alleging that its former client owed it $93,811.95 in fees for legal services and that payment had been demanded and not made. Dimitrakopoulos, acting pro se, filed an answer to the collection complaint but filed no counterclaim or third-party claim. In a proceeding before an arbitrator six months after the collection action was filed, the Dimitrakopouloses and the Eleftherious settled their dispute. In light of the settlement, the arbitrator did not issue an award. Months later, the court in the collection matter granted the Borrus firm’s unopposed motion for a final judgment by default in the amount of $121,947.99 for legal services, interest, attorneys’ fees, and court costs. Dimitrakopoulos did not appeal. A total of sixteen months elapsed between the filing of the Borrus firm’s collection action and the entry of the default judgment in that action. After the resolution of the business dispute between the Dimitrakopouloses and the Eleftherious, the collection action remained pending for an additional ten months. On September 10, 2015, approximately three years after the entry of judgment in the collection action, the Dimitrakopouloses sued the Borrus firm and the principal attorneys who worked on their matter for legal malpractice. Defendants moved to dismiss the complaint based on the "entire controversy" doctrine and the doctrine of waiver. The Dimitrakopouloses argued that the damages claimed in the malpractice action were known to them as of September 6, 2011, the day that they settled their dispute with the Eleftherious. The trial court concluded that the Dimitrakopouloses could have asserted their malpractice claim in the collection matter. An Appellate Division panel affirmed that judgment and stated that under Olds v. Donnelly, 150 N.J. 424 (1997), legal malpractice claims were exempt from the entire controversy doctrine to the extent that they need not be asserted in the underlying action. The New Jersey Supreme Court concluded the collection action at issue in this matter was not an “underlying action” as that term was used in Olds, and that the entire controversy doctrine could bar the claim. The record of this appeal, however, was inadequate for an application of the equitable rules that governed here. The Court therefore reversed the Appellate Division, and remanded the case for further proceedings. View "Dimitrakopoulos v. Borrus, Goldin, Foley, Vignuolo, Hyman and Stahl, P.C." on Justia Law
In this appeal, the New Jersey Supreme Court considered whether an attorney’s pledge of anticipated attorney’s fees could be considered an account receivable and secured under Article 9 of the Uniform Commercial Code (UCC), and whether the lender here complied with the requirements of the UCC to perfect its security interest. Plaintiff John Giovanni Granata retained Diane Acciavatti to bring a legal malpractice complaint against defendants Edward Broderick Jr., and Broderick, Newmark, & Grather. Acciavatti accepted a $10,000 retainer and agreed to a contingent fee arrangement. After a jury trial, Granata was awarded a judgment of $1,597,193, and the trial judge granted Acciavatti’s motions for fees, costs, and pre-judgment interest. Defendants appealed, and Granata cross-appealed. Acciavatti had an oral agreement with Granata to represent him at $350 per hour and told him she would seek counsel fees from defendants after the appeal. While the appeal was pending, Acciavatti withdrew from the practice of law. Dominic Caruso was appointed attorney-trustee for Acciavatti’s practice, and the firm of Roper & Twardowsky, LLC (the Roper firm), filed a substitution of counsel form for Acciavatti. The Appellate Division reversed and remanded for a new trial. Following a two-day mediation, the case settled for $840,000. Three of Acciavatti’s creditors then claimed liens upon any legal fees owed to her from the case. The appellate panel considered whether Acciavatti possessed an interest in her anticipated legal fees and whether one of her creditor's UCC filing granted it a perfected interest in those fees. The panel reasoned that, “[i]f both questions [we]re answered in the affirmative, [the creditor], as a perfected secured creditor, would enjoy priority over [the other creditors], who are subsequent lien creditors seeking to levy on the same collateral.” The panel expressed agreement with cited decisions and held “that, under certain circumstances, an attorney’s pledge of anticipated counsel fees can be considered an account receivable and secured under Article 9.” The panel observed that “[the appealing creditor] met the requirements of N.J.S.A. 12A:9-203 for its security interest to attach to Acciavatti’s counsel fees." Finding no reversible error in that judgment, the Supreme Court affirmed. View "Granata v.Broderick" on Justia Law
Conley v. Guerrero
In 1983, the New Jersey Supreme Court affirmed a final consent judgment for a settlement agreement between the New Jersey State Bar Association and the New Jersey Association of Realtor Boards. The terms of the settlement provided that real estate brokers and salespersons may prepare contracts to sell or lease real property, so long as a standard form is used that includes a three-day period for attorney review. Plaintiffs Michael Conley, Jr., and Katie M. Maurer (Buyers) made an offer to purchase a condominium from defendant Mona Guerrero (Seller), and, a few days later, Seller signed and executed the contract. Before the three-day attorney-review period expired, Seller s attorney sent Buyers attorney and their realtor notice of disapproval by e-mail and fax, rather than by the methods approved under the 1983 holding and prescribed in the parties' contract (certified mail, telegram, or personal service). Buyers sued for specific performance, claiming the contract was enforceable because Seller s notification of disapproval was sent improperly. At issue before the Supreme Court was whether the attorney-review provision of a standard form real estate contract had to be strictly enforced, thereby nullifying Seller's notice of disapproval and requiring enforcement of the real estate contract. The Court concluded that, because Buyers received actual notice of disapproval within the three-day attorney-review period by a method of communication commonly used in the industry, the notice of disapproval was valid. The Court also exercised its constitutional authority over the practice of law and found that an attorney's notice of disapproval of a real estate contract could be transmitted by fax, e-mail, personal delivery, or overnight mail with proof of delivery. Notice by overnight mail will be effective upon mailing. The attorney-review period within which this notice must be sent remained three business days. View "Conley v. Guerrero" on Justia Law
Mortgage Grader, Inc. v. Ward & Olivo, L.L.P.
In this appeal, the issue this case presented for the Supreme Court's review centered on whether a law firm practicing as a limited liability partnership (LLP) failed to maintain professional malpractice insurance to cover claims against it, and, if so, whether that failure should cause the revocation of the firm's LLP status, rendering innocent partners personally liable. In July 2009, Mortgage Grader hired Olivo of Ward & Olivo (W&O) to pursue claims of patent infringement against other entities. Mortgage Grader entered into settlement agreements in those matters. In exchange for one-time settlement payments, Mortgage Grader granted those defendant-entities licenses under the patents, including perpetual rights to any patents Mortgage Grader received or obtained through assignment, regardless of their relationship to the patents at issue in the litigation. It is those provisions of the settlement agreement that allegedly gave rise to legal malpractice. In 2011, W&O dissolved and entered into its windup period. W&O continued to exist as a partnership for the sole purpose of collecting outstanding legal fees and paying taxes. The next day, Ward formed a new LLP and began to practice with a new partner. Mortgage Grader filed a complaint against W&O, Olivo, and Ward in October 2012, alleging legal malpractice by Olivo, and claiming that the settlement agreements resulting from Olivo's representation harmed Mortgage Grader's patent rights. The motion court denied Ward's motion to dismiss, first determining that Mortgage Grader had failed to comply with the statutory requirement to serve an affidavit of merit (AOM) on each defendant named in the complaint, and rejected its substantial compliance argument. However, the court also determined that W&O failed to maintain the requisite insurance, which caused its liability shield to lapse and relegated W&O to a GP. Thus, the motion court concluded that Ward could be held vicariously liable for Olivo's alleged legal malpractice. The Appellate Division reversed. The Supreme Court affirmed, finding that law firms organized as LLPs that malpractice insurance did not extend to the firm's windup period, and tail insurance coverage was not required. View "Mortgage Grader, Inc. v. Ward & Olivo, L.L.P." on Justia Law
Kaye v. Rosefielde
Plaintiff Bruce Kaye, the controlling principal of three entities that sold and managed timeshare interests in resort properties in Atlantic County, hired defendant Alan Rosefielde, an attorney admitted to practice law in New York but not in New Jersey, initially as outside counsel, and then as an employee. After defendant had worked closely with plaintiff for approximately four months, the parties entered an agreement providing that, as compensation for his services, defendant would earn an annual salary of $500,000. For approximately two years, defendant served as Chief Operating Officer for several of the timeshare entities, and effectively functioned as their general counsel. In that capacity, defendant committed serious misconduct by acting on his own behalf instead of for his employers benefit, and exposing his employers to potential liability. Based on this misconduct, and dissatisfaction with defendant’s performance, plaintiff terminated defendant’s employment. Kaye, in his individual capacity and as trustee of two trusts, Kaye’s son Jason Kaye, and the business entities that Kaye owned, sued Rosefielde and several other entities. Plaintiffs asserted claims based on Rosefielde’s breach of fiduciary duty, fraud, legal malpractice, unlicensed practice of law, and breach of the duty of loyalty. Following a lengthy bench trial, the trial court found that Rosefielde engaged in egregious conduct constituting a breach of his duty of loyalty, breach of his fiduciary duty, legal malpractice, and civil fraud. The trial court rescinded Rosefielde’s interest in several entities, awarded compensatory damages, punitive damages, and legal fees, and dismissed Rosefielde’s counterclaims. It declined, however, to order the equitable disgorgement of Rosefielde’s salary as a remedy for his breach of the duty of loyalty, on the ground that his breach did not result in damage or loss to the entities that employed him. The Appellate Division affirmed that determination, and the New Jersey Supreme Court granted certification on the issue of equitable disgorgement. “In imposing the remedy of disgorgement, depending on the circumstances, a trial court should apportion the employee’s compensation, rather than ordering a wholesale disgorgement that may be disproportionate to the misconduct at issue. . . . If an agent is paid a salary apportioned to periods of time, or compensation apportioned to the completion of specified items of work, he is entitled to receive the stipulated compensation for periods or items properly completed before his renunciation or discharge. This is true even if, because of unfaithfulness or insubordination, the agent forfeits his compensation for subsequent periods or items.” The judgment of the Appellate Division was reversed with respect to the remedy of equitable disgorgement, and the matter was remanded to the trial court to decide whether plaintiffs were entitled to disgorgement. If so, the trial court should apportion Rosefielde’s compensation, ordering disgorgement only for monthly pay periods in which he committed acts of disloyalty. View "Kaye v. Rosefielde" on Justia Law