On appeal from the Superior Court, Chancery Division, Essex County.
Matthews, Morton I. Greenberg and Loftus. The opinion of the court was delivered by Morton I Greenberg, J.A.D.
This appeal raises important questions with respect to a successful litigant attempting to recoup counsel fees through application of R. 4:58, R. 4:22-1 and R. 4:23-2. An understanding of the issues on this appeal requires that the procedural and factual history of this case be set forth at some length.
On or about April 24, 1978 plaintiff bank filed this action in the Superior Court, Chancery Division. The gravamen of its complaint was that defendant Bolger, a former vice-president of the bank, had conspired with the other defendants to have plaintiff acquire "home improvement paper" from defendant Capital Resources Corp., of a nature not acceptable to plaintiff. Plaintiff further alleged that Bolger had acted in the acquisition of these instruments on behalf of plaintiff, had exceeded his authority in so acting, had improperly taken the contracts without recourse against Capital and that as a result plaintiff without recourse against Capital and that as a result plaintiff had suffered and would suffer excessive losses. The action had been generated by the fact that the management of plaintiff had become dissatisfied with the portfolio acquired from Capital. Bolger had been discharged by plaintiff but subsequently obtained employment with Capital. Plaintiff was suspicious of these events. Subsequently, plaintiff filed an amended complaint asserting that Capital was liable to it for $39,016.44 on defaulted loans. This liability was on loans purchased by plaintiff claimed to be with "full rights of recourse."
Bolger filed an answer denying the allegations of the complaint. He also counterclaimed against plaintiff. In the counterclaim he charged that plaintiff, by bringing the action, was liable to him for malicious abuse and malicious use of process, defamation, interference with an advantageous business relationship and intentional infliction of emotional harm. The record presented on this appeal is not complete but it appears that the other defendants also filed pleadings denying the allegations of the complaint.
On July 18, 1978, pursuant to R. 4:22-1, Bolger filed a request that plaintiff file a written answer to the truth of the following statements:
1. That on or about May 28, 1975, Henry Gerberding was the Chief Operating Officer of the Essex Bank and was a member of the Board of Directors.
2. That the alleged "discounting agreement", referred to in paragraph 2 of the Complaint, was prepared by the plaintiff upon the instructions of Henry Gerberding.
3. That said Henry Gerberding, in his capacity as President of the plaintiff and as a member of the Board of Directors of the plaintiff, instructed, directed, authorized and thereafter approved and ratified all complained-of acts performed by the defendant-counter claimant.
4. That the alleged "discounting agreement" was not beyond the authority of Nicholas G. Bolger.
5. That all loans presented for discount to plaintiff by Capitol Resources Corp. were accepted by the plaintiff with the approval, knowledge or ratification of plaintiff's Board of Directors.
6. That all of the subject loans were within the lending area developed by the plaintiff.
7. That none of the subject loans were "commercial paper".
8. That substantially all default conditions alleged in paragraph 6 of the First Count of plaintiff's complaint are the result of negligent, deficient and untimely bookkeeping and collection practices of the ...