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ROBERTSON v. CENTRAL JERSEY BANK & TRUST CO.

October 5, 1993

MELISSA ROBERTSON, Plaintiff,
v.
THE CENTRAL JERSEY BANK & TRUST COMPANY, et al., Defendants.


WOLFSON


The opinion of the court was delivered by: WOLFSON

WOLFSON, UNITED STATES MAGISTRATE JUDGE

 Presently before the Court is the motion of defendant, Central Jersey Bank & Trust Co. ("Central Jersey"), seeking to compel the deposition of Kerry E. Higgins, Esq. ("Ms. Higgins"). Having considered the moving, opposition, and reply papers, and the oral arguments of counsel, the Court finds, for the reasons set forth below, that defendant's motion shall be granted.

 BACKGROUND

 Defendant, Central Jersey, was the executor and trustee of the Estate of Irene Lockwood Robertson ("the decedent"). While decedent had bequeathed a life interest in the Estate to her husband, she also named her granddaughter, the plaintiff Melissa Robertson, as a residuary beneficiary of the Estate. *fn1" The property was to be held in trust for her by Central Jersey until she reached the age of twenty-five years. The trust was created on January 23, 1984, and the most significant assets in the trust included shares of stock in Central Jersey, other miscellaneous stock, and a parcel of real property located at 62 Harvard Road in Fairhaven, New Jersey.

 On or about February 29, 1988, Central Jersey had concluded the administration and management of the Estate and filed a complaint in action for settlement in the Probate Court of the State of New Jersey. *fn2" Since plaintiff was still a minor at the time, the court appointed Ms. Higgins guardian ad litem to represent plaintiff's residuary interests in the Estate.

 As guardian ad litem, Ms. Higgins prepared a "report of counsel" for the Probate Court which addressed the significant transactions undertaken by Central Jersey during the administration of the Estate and identified the assets which comprised the corpus of the trust. Included in the report was a discussion concerning the propriety of certain decisions made by Central Jersey, including those regarding sale of the 62 Harvard Road property as well as the sales of Central Jersey Bank stock. According to the report, in June of 1988, Ms. Higgins met with the plaintiff's parents, Mr. & Mrs. Robertson, to review the accountings of the Estate. The parents had questioned both the stock and real estate transactions, expressing "extreme dissatisfaction" with Central Jersey's performance as trustee of the Estate.

 In defending against the present action, Central Jersey now seeks to compel the deposition of Ms. Higgins. Central Jersey argues that the communications between Ms. Higgins and plaintiff's parents are relevant to the claims and defenses in this action. specifically, defendant claims that the Robertsons' objection to the sale of Central Jersey stock in 1988 is inconsistent with the plaintiff's present claim that Central Jersey breached a fiduciary duty to the plaintiff by failing to diversify the stock holdings which comprised the trust. *fn3" Indeed, defendant believes that the deposition of Ms. Higgins may reveal that the plaintiff, through her parents, had consented to the retention of Central Jersey's stock.

 Plaintiff does not dispute the relevancy of this information but argues that the attorney-client privilege protects these communications from discovery. Because Ms. Higgins is concerned that her deposition testimony might run afoul of the privilege, she has refused to be deposed. Thus, the issue before the Court is whether communications between a guardian ad litem and a minor's parents are protected by the attorney-client privilege. This Court holds that they are not.

 DISCUSSION

 When jurisdiction is based on diversity, Rule 501 of the Federal Rules of Evidence requires this Court to examine state law in deciding questions of privilege. See United Coal Co. v. Powell Constr. Co., 839 F.2d 958, 965 (3rd Cir. 1988). Therefore, while New Jersey state and federal courts both recognize that the policy behind the privilege is to promote "full and frank communications between attorneys and their clients", United Jersey Bank v. Wolosoff, 196 N.J. Super. 553, 561, 483 A.2d 821 (App. Div. 1984) (quoting Upjohn Co. v. United States, 449 U.S. 383, 389, 66 L. Ed. 2d 584, 101 S. Ct. 677 (1981)); See also In re Environmental Ins. Declaratory Judgment Actions, 259 N.J. Super. 308, 313, 612 A.2d 1338 (App. Div. 1992), the application of the attorney-client privilege in this case will be determined by New Jersey law.

 In New Jersey, the attorney-client privilege is well established and vigorously protected. See In the Matter of Nackson, 114 N.J. 527, 531-32, 555 A.2d 1101 (1989); State v. Sanders, 260 N.J. Super. 491, 497, 616 A.2d 1345 (App. Div. 1992); see also N.J. Evid. R. 26; N.J.S.A. 2A:84A-20. Nevertheless, the attorney-client privilege is not absolute and it is to be strictly limited to the purposes for which it exists. See Hansen v. Janitschek, 31 N.J. 545, 158 A.2d 329 (1960); State v. Humphreys, 89 N.J. Super. 322, 325, 215 A.2d 32 (App. Div. 1965); see also Dry Branch Kaolin Co. v. Doe, 263 N.J. Super. 325, 330, 622 A.2d 1320 (App. Div. 1993). This is so because the attorney-client privilege advances secrecy and "runs counter to the fundamental theory of our judicial system that the fullest disclosure of the facts will best lead to the truth." In re Selser, 15 N.J. 393, 405, 105 A.2d 395 (1954); see also Longo v. American Policyholders' Ins. Co., 181 N.J. Super. 87, 85-90, 436 A.2d 577 (Law Div. 1981).

 To be protected by the attorney-client privilege, the communication between attorney and client must be made "in professional confidence". See N.J. Evid. R. 26; Coyle v. Estate of Simon, 247 N.J. Super. 277, 282, 588 A.2d 1293 (App. Div. 1991). Thus, the shield of secrecy is raised only with respect to "confidential communications made within the context of the strict relation of attorney and client." Coyle, 247 N.J. Super. at 282. Therefore, the privilege will not extend to communications where the attorney is acting in a capacity other than as counsel. See Metalsalts Corp. v. Weiss, 76 N.J. Super. 291, 299, 184 A.2d 435 (Ch. Div. 1962) (privilege denied where attorney acted as investigator); Newark Bd. of Ed. v. Newark Teachers Union Local 481, AFT, AFL-CIO, 152 N.J. Super. 51, 62-63, 377 A.2d 765 (App. Div. 1977) (privilege did not protect notes prepared by an attorney serving as a negotiating representative in a labor dispute); see also Leonen v. Johns-Manville, 135 F.R.D. 94, 98-99 (D.N.J. 1990) (privilege did not protect the communications with in-house counsel relating to business rather than legal matters). Moreover, a communication between an attorney and client will not be privileged if the communication was made with the understanding that it would be imparted to third parties. See United States v. Merrell, 303 F. Supp. 490, 492-93 (N.D.N.Y. 1969); see also Coyle, 247 N.J. Super. at 282.

 Because Ms. Higgins, a lawyer, was appointed by the court as Melissa Robertson's guardian ad litem, rather than as her legal counsel, this case does not involve a typical attorney-client relationship. New Jersey has not yet addressed whether the attorney-client privilege should attach to the communications of a guardian ad litem, and few other jurisdictions have had the ...


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