On appeal from the Superior Court of New Jersey, Law Division, Morris County.
Before Judges Skillman, Wallace and Kleiner.
The opinion of the court was delivered by
Plaintiff, Ronald Gilgallon, filed a complaint alleging breach of contract and fraud against defendants Edward and Clara Bond. Summary judgment was granted to defendant Edward Bond. Plaintiff proceeded to a non-jury trial against Clara Bond, and judgment was entered for defendant on June 14, 1993. On July 23, 1993, plaintiff moved, pursuant to R. 4:50-1(c), to vacate that judgment predicated upon allegations that defendant and her husband, Edward Bond, had both offered perjured testimony during the trial.*fn1
R. 4:50-1 provides for relief from a judgment or order for reasons including "(c) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party[.]" Ibid. R. 4:50-2 provides that a motion pursuant to R. 4:50-1(c) "shall be made within a reasonable time, and . . . not more than one year after the judgment . . . was entered or taken." Ibid.
The most definitive Discussion of a motion for relief from a judgment due to fraud appears in Shammas v. Shammas:
Perjured testimony that warrants disturbance of a final judgment must be shown by clear, convincing and satisfactory evidence to have been, not false merely, but to have been willfully and purposely falsely given, and to have been material to the issue tried and not merely cumulative but probably to have controlled the result. Further, a party seeking to be relieved from the judgment must show that the fact of the falsity of the testimony could not have been discovered by reasonable diligence in time to offset it at the trial or that for other good reason the failure to use diligence is in all the circumstances not a bar to relief.
The trial Judge concluded that plaintiff's motion failed to clearly and convincingly demonstrate that the false testimony had been "willfully and purposely falsely given," ibid., and that plaintiff through diligence could have offset the false testimony at trial. We conclude that the trial court's decision is "'so wholly insupportable as to result in a denial of Justice[.]'" Rova Farms Resort v. Investors Ins. Co., 65 N.J. 474, 483-84, 323 A.2d 495 (1974) (quoting Greenfield v. Dusseault, 60 N.J. Super. 436, 444, 159 A.2d 433 (App. Div.), aff'd o.b., 33 N.J. 78 (1960)).
We review the facts as we glean them, based on the testimony and exhibits at trial, and pleadings and exhibits offered in support of plaintiff's post-trial motion.
On January 21, 1978, the Polish-American Center, Inc. was the owner and operator of retail consumption liquor license #C-30 issued by the Town of Harrison, and it operated a liquor business at premises it also owned at 9-11 Patterson Street. It entered into a contract to sell the building, all equipment and the liquor license, as an operating business, to plaintiff and Edward Bond. The purchasers executed the contract as "nominees for a corporation to be formed." The contract was contingent on the buyers securing a first mortgage of $46,500 by February 15, 1978. The balance of the purchase price was to be paid at settlement.
Prior to settlement, which occurred April 10, 1978, plaintiff and Bond formed a corporation under the name Friends, Inc. One hundred shares of common stock were issued: forty-nine shares to plaintiff; one share to plaintiff's wife, Eileen Gilgallon; forty-nine shares to Edward Bond; and one share to Bond's wife, defendant Clara Bond. At settlement, Friends, Inc. executed a purchase money mortgage for $46,000 to the First National Bank and Trust Company of Kearny. A corporate resolution of the sellers, dated April 10, 1978, authorized the sale of 9-11 Patterson Street. The resolution ...