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Eckerd Drugs of New Jersey Inc. v. 215

June 14, 1979

ECKERD DRUGS OF NEW JERSEY, INC., PLAINTIFF,
v.
S.R. 215, RITE-AID CORP., VINCENT SEVERINO AND THOMAS SYLK, DEFENDANTS



Francis, A.j.s.c.

Francis

[170 NJSuper Page 38] Plaintiff Eckerd Drugs of New Jersey, Inc. (Eckerd) has brought suit in the Chancery Division against S.R. 215, Rite-Aid Corp. (Rite-Aid), Vincent Severino and Thomas Sylk over the sale of a drugstore business. Eckerd claims that it had an agreement with S.R. 215 to buy a drugstore business and its assets from the latter, and in contemplation of the sale entered into contracts and took other action consistent with such agreement, but that no executed written contract of sale was ever presented to plaintiff and instead defendant S.R. 215 entered into a written agreement with defendant Rite-Aid, a competitor of Eckerd's. Eckerd demands performance of its agreement with S.R. 215, including restraints on any disposition of the

assets of the business in question except in accordance with this agreement; a setting aside of the contract between S.R. 215 and Rite-Aid; delivery to Eckerd of all assets of S.R. 215 in its possession; an accounting of any disposition of such assets, and damages both compensatory and punitive. On motion plaintiff has been permitted to amend its complaint to allege that Rite-Aid deliberately induced S.R. 215 to breach its agreement with plaintiff and is therefore guilty of the tort of intentional interference with an existing contractual relationship between plaintiff and S.R. 215; alleging in the alternative, in the event no contract should be found between plaintiff and S.R. 215, a tortious inference with a prospective economic advantage. By way of relief in this amended complaint plaintiff demands that Rite-Aid sell the assets acquired from S.R. 215 to Eckerd and account to Eckerd for all revenues and profits realized by it since the acquisition, and demands compensatory and punitive damages. As to the issues in the amended complaint, Eckerd demands a trial by jury, and that is the question to be decided here.

N.J.Const. (1947), Art. I, ยง 9, states that "The right of trial by jury shall remain inviolate." This means that it remains as it was under the prior Constitution of 1844. Ebling Brewing Co. v. Heirloom, Inc. , 1 N.J. 71 (1948). The 1844 Constitution was implemented by a 1915 statute, which stated:

If any question, ordinarily determinable at law and requiring a jury trial, arise in a suit of which the court of chancery has jurisdiction, a jury trial, if required, may be ordered, but shall be deemed to be waived unless demanded in the pleadings. If demanded, and the issue be one requiring a jury trial, the court shall send such issue of fact to a court of law for trial according to the existing practice.

Neither this statute nor the present constitutional guarantee is of much assistance in determining whether plaintiff is entitled to a jury trial of the issues raised in the amended complaint. There is no doubt that the tort of interference with prospective

economic advantage presents a legal issue and normally entitles a plaintiff to a jury trial. Leslie Blau Co. v. Alfieri , 157 N.J. Super. 173 (App.Div.1978).

The federal court system, as noted in plaintiff's brief in support of its motion, supports an absolute right to jury trial of legal issues. In Dairy Queen v. Wood , 369 U.S. 469, 82 S. Ct. 894, 8 L. Ed. 2d 44 (1962), the trial judge denied a jury trial in a case arising out of a franchising contract where the primary relief sought was restraints and an accounting. Defendant counterclaimed for debt due under the contract together with, or in the alternative, damages for trademark infringement. The trial judge held that either the action was purely equitable or the legal issues raised were incidental to the equitable issues, and that no right to a jury trial existed in either case. The Court of Appeals for the Third Circuit denied mandamus , and the Supreme Court granted certiorari. The court held that in the federal courts the right to trial by jury of legal issues incidental to equitable issues, where properly demanded, may not be lost, and that the legal question of breach of contract must be decided prior to the court's determination of the respondents' equitable claims. In support of its decision the court cited Beacon Theatres, Inc. v. Westover , 359 U.S. 500, 510, 511, 79 S. Ct. 948, 957, 3 L. Ed. 2d 988 (1950), for the proposition that "only under the most imperative circumstances, circumstances which in view of the flexible procedures of the Federal Rules we cannot now anticipate, can the right to a jury trial of legal issues be lost through prior determination of equitable claims."

New Jersey practice is rather more enigmatic. The right to a jury trial of legal issues is not necessarily absolute but depends on common law practice. Such a right may be invoked in accordance with R. 4:35-1. Cases decided before the adoption of the 1947 Constitution make it clear that once equity jurisdiction attaches it will be retained in order to avoid a multiplicity of suits:

Ordinarily, the jurisdiction of equity is tested by the facts existing at the inception of the suit; and if the complainant is then entitled to equitable relief, equity's jurisdiction to settle all the issues, even though purely legal in nature, and to award damages for the breach of a legal right involved in the suit, will not be defeated by subsequent events which render equitable relief impracticable or ...


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