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In re Limongelli

Decided: December 1, 1992.

IN RE WILLIAM LIMONGELLI, D.D.S., PETITIONER-APPELLANT,
v.
NEW JERSEY STATE BOARD OF DENTISTRY, RESPONDENT-RESPONDENT



On appeal from Final Decision of the New Jersey State Board of Dentistry.

Petrella, Long and D'Annunzio. The opinion of the court was delivered by Petrella, P.J.A.D.

Petrella

[260 NJSuper Page 348] Dr. William Limongelli appeals from a decision of the New Jersey State Board of Dentistry denying his petition for relicensure and extending his suspension for an additional ten year period. His license had been revoked by consent order dated January 9, 1986, with the stipulation that he could apply for reinstatement after five years. The revocation was based on Limongelli's plea of guilty to seven counts of a twelve-count criminal indictment for theft by deception through the submission of multiple fraudulent insurance claims. As a result of the revocation or suspension*fn1 Limongelli was required to divest

himself of any interest in the various dental practices with which he was associated.

For an understanding of what transpired, a recitation of the facts is necessary.

Prior to a January 22, 1991 reinstatement petition by Limongelli, the Board had conducted a transcribed investigative inquiry based upon information it received that he was continuing to practice during his suspension. Testimony of Dr. Anthony Vitale, D.M.D., was taken on February 15, 1989, without Limongelli being present or notified. Limongelli's testimony was taken on March 29, 1989, and he was advised by the Board that it would inform him of its findings. No action was taken of any sort before Limongelli applied for reinstatement.

In 1984, Limongelli was the sole shareholder in two professional corporations which operated Dental Parkway Clinic, Inc., in Newark and Orange Dental Center, P.C., in Orange. He owned the buildings where these practices were located, and rented space to the two professional corporations.

According to the 1989 testimony of Vitale,*fn2 taken out of the presence of Limongelli, which the Board considered in its 1991 decision, Vitale began to work for Limongelli several days per week and also worked part-time for another dentist beginning in 1984, two years after graduating from dental school. Late in 1984, Vitale purchased the other dentist's practice. In late 1985 due to financial difficulties, Vitale approached Dr. Limongelli and asked him if he was interested in purchasing 50% of the stock in his practice. Thereafter, the two formed a professional corporation known as Personal Choice Dental Associates, P.A. (Personal Choice).

For his interest in Personal Choice, Limongelli paid $7,500, obtained a second mortgage on one of his properties to finance a letter of credit which had been required by the prior owner and made installment payments. According to Limongelli, he made the final installment in January 1986. Vitale had testified in 1989 that the final installment was not paid until June 1986.

According to Vitale, he learned of Limongelli's license revocation sometime in August 1986, and negotiations then began regarding a buy-out of Limongelli's shares in Personal Choice. Vitale explained before the Board that it was not until November or December 1986 that the partnership was dissolved. However, according to a letter written by Vitale's attorney, transfer of the stock in Personal Choice had not been effectuated as of December 17, 1987.

With respect to Limongelli's efforts to divest his interests in the two dental clinics of which he was the sole shareholder, Limongelli's accountant approached Vitale in the beginning of 1986 to determine if he was willing to purchase the two dental clinics. As noted, Vitale was supposedly not aware until August 1986 that Limongelli's license had been revoked, and the parties began to seriously negotiate a buy-out of both clinics at that time.

According to Limongelli, the parties began to plan for Vitale to take over the clinics in October 1985. On October 7, 1985, certificates of change of registered agent were filed for the two clinics, naming Vitale as the new agent. Limongelli testified that his attorney told him that that was all that was required to transfer ownership of the clinics. Limongelli said that he thought that as of January 1986 he no longer owned the practice after Vitale became the registered agent and filed the annual report, even though Vitale never paid anything for the patient records, equipment or instruments.

On August 25, 1986, Vitale executed a document which provided that he was the "Director with Intent to Purchase" of

the two individually named clinics.*fn3 According to Vitale's 1989 testimony, he was not represented by counsel during the negotiations, and the document was prepared by Limongelli's attorney. Limongelli's attorney was supposed to follow up with the actual paperwork to effectuate the sale of the two clinics. No money had exchanged hands and no purchase price had even been discussed, no contract was signed, and according to Vitale, when he shook hands with Limongelli he did not consider that he had purchased the clinics. Rather he had agreed that he would be the owner in the future and would take over directorship of the two clinics.

Limongelli acknowledged that no money exchanged hands. His position was that Vitale agreed to run the clinics "for awhile" and then they would execute a buy-out agreement. Limongelli concedes that the "actual paperwork" regarding the buy-out did not get started until 1987. Limongelli fixed a price of $350,000 and $250,000, respectively, for the two clinics.

The actual buy-out was never consummated. Although some papers were drawn-up, they were never signed. At no time did Limongelli try to sell either of the individually owned clinics to anyone else and never advertised their sale nor sought assistance from a broker.

In July 1988, almost a year after "formal" negotiations began, Vitale wrote Limongelli's attorney that he was no longer interested in purchasing the dental clinics and asking that his name be removed from all accounts, corporate registrations, insurance forms, payroll accounts and telephone directories. Vitale said in 1989 that he felt he was being "strung along" for two years. He stated:

I am out here, I feel like I was put out in left field stretched out for two years. I am spending my money, going to the lawyers; I am calling, checking

with the banks to make sure everything is all right and then it all ...


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