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Gallano v. Running

Decided: February 3, 1976.

NORMA E. GALLANO, GERALD GALLANO, PATRICIA RYAN, JOHN RYAN, JOHN TOBIN, MARGARET TOBIN, JANE E. GOVIA, DONALD GOVIA, CATHERINE CONKLIN, ALFRED VAY, LOUIS USATI, CHARLES USATI, ALBINA CERRUTI, LOUIS CERRUTI, FRAN FRATTINI, VANCE W. DUKHUIS, JANET COPOZZI, ROSE MARIE MEYER, DOROTHY HOYT, NORMAN C. HOYT, ALMA HEINZELMANN, ETHEL M. PLENKERS AND HARRY R. PLENKERS, PLAINTIFFS,
v.
JOHN M. RUNNING AND RINGWOOD BOROUGH SEWERAGE AUTHORITY, DEFENDANTS



Johnson, J.s.c.

Johnson

This court must determine whether the instant suit may proceed as a class action under R. 4:32.

On June 12, 1975 the 23 named plaintiffs, all owners of realty in the Borough of Ringwood in the area to be serviced and billed by the Ringwood Borough Sewerage Authority (Authority), filed suit against the Authority and its counsel, John M. Running. Counts 1 and 2 of the complaint allege that the Authority improperly paid Running $25,070 for legal services performed in connection with the issuance of revenue bonds of the Authority, in contravention of N.J.S.A. 40A:2-38.1 and equitable principles of reasonable compensation. Plaintiffs pray that the $25,070 fee paid be determined to be excessive and seek an order that it, or a portion thereof, be refunded to the treasurer of the Ringwood Borough Sewerage Authority.

In count 3 plaintiffs complain that payments of an additional fee of $10,500 by the Authority to Running for preparation of 42 utility easements were based upon an illegal retainer agreement and were excessive. Plaintiffs seek an order amending the retainer agreement and requiring Running to return to the treasurer of the Ringwood Borough Sewerage Authority any sums received that the court finds excessive.

Because plaintiffs have brought this action "for themselves and for all others similarly situated, their number being large and it being impracticable to bring all of them before this Court," a hearing was held on December 9, 1975 on the court's own motion to determine whether an order under R. 4:32-2(a) should issue allowing this suit to proceed as an R. 4:32-1 class action.

In the interest of clarity this opinion is bifurcated into an examination of (1) whether an order of maintainability under R. 4:32-2(a) should issue, and (2) whether any orders under R. 4:32-3 should issue.

I

The judicial economy inherent in the efficient resolution of multiple party disputes is the cornerstone of the class action suit. Wright & Miller, Federal Practice and Procedure: Civil § 1754 at 543. Federal Rule of Civil Procedure 23 , as amended in 1966, the counterpart of R. 4:32, has been described as "the wave of the future" which will accelerate the resolution of multiple party disputes that have been spawned by the "increasing complexity and urbanization of modern American society." Wright & Miller, op. cit. , Civil § 1751 at 510-511.

This "wave" has landed upon New Jersey's shores to the plaudits of our judiciary. In the absence of a "clear showing" that a class suit is improper, this court must certify the instant action as a class suit in accordance with the liberal construction that must be afforded the rule. See Pressler, Current N.J. Court Rules, comment to R. 4:32; Lusky v. Capasso Bros. , 118 N.J. Super. 369, 373 (App. Div. 1972), certif. den. 60 N.J. 466 (1972); Riley v. New Rapids Carpet Center , 61 N.J. 218, 228 (1972); Kronisch v. Howard Savings Inst. , 133 N.J. Super. 124, 131 (Ch. Div. 1975). Indeed, the amendments to R. 4:32-2(b) and (c), effective April 1, 1975, evidence a clear desire by our Supreme Court that certain hurdles which have impeded federal class actions be removed in this state. See Pressler, op. cit. , comment to R. 4:32.

In order for this suit to proceed as a class action all of the requirements of R. 4:32-1(a) must be met in addition to at least one provision of R. 4:32-1(b). R. 4:32-1(a) provides:

General Prerequisites to a Class Action. One or more members of a class may sue or be sued as representative parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.

At the December 9, 1975 hearing it was represented that there are at least 3,000 property owners encompassed by the putative class. Joinder of all members is certainly impracticable. This court makes no effort to determine the exact number of members nor their identity, since such an exercise goes well beyond the court's duties so long as the class itself is well defined. Kronisch v. Howard Savings Inst., supra , 133 N.J. Super. at 132.

The factual framework of plaintiff's suit eliminates the need for a separate analysis of R. 4:32-1(a)(2) and (3). See 3B Moore's Federal Practice , par. 23.06-1 at 23-301-302. In Lusky v. Capasso Bros., supra , plaintiffs, as residents of the Village of Ridgewood, sued the defendants who had entered into a license agreement with the village. The agreement granted defendants a three-year exclusive right to remove garbage in the village. Plaintiffs complained of breaches by defendants of both the licensing agreement and individual agreements with the class members in ...


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