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Gangemi v. National Health Laboratories

October 28, 1997


On appeal from Superior Court of New Jersey, Law Division, Morris County.

Approved for Publication October 28, 1997.

Before Judges Havey, Newman and Collester.*

The opinion of the court was delivered by Newman, J.A.D.

The opinion of the court was delivered by: Newman

The opinion of the court was delivered by


Defendant, National Health Laboratories, Inc. (NHL), appeals from the grant of summary judgment dismissing its claim for contribution against third-party defendant, Dr. Kenneth Garrett, and also from the denial of its cross-motion to enter a consent judgment reflecting a settlement between NHL and plaintiff Julie Gangemi, who sued NHL individually and as executrix of the estate of Rita M. Blasko. We reverse and remand for further proceedings.

These are the relevant facts. Rita M. Blasko died of advanced cervical cancer. NHL misread a PAP smear in 1989, which, if correctly read, would have led to an early diagnosis of the cancer and effective life-saving treatment. Plaintiff sued NHL after Blasko's death. Plaintiff's attorneys retained an expert who concluded that Dr. Garrett did not deviate from accepted medical practice in relying upon the erroneous PAP smear results forwarded by NHL.

NHL impleaded Dr. Garrett through third-party practice. NHL engaged its own medical expert, Dr. Stephen Leviss, an OB/GYN, who stated that Dr. Garrett should not have relied solely on NHL's statement that the May 1989 PAP smear was negative, but should have considered NHL's other clinical findings. Dr. Leviss reasoned that NHL's results indicated that its diagnosis was obscured by inflammation and excess red and white blood cells. According to Dr. Leviss, these abnormal conditions should have placed Dr. Garrett on alert and he should have reevaluated Blasko immediately. Additionally, NHL retained an oncologist, Dr. Frederick Cohen, who also criticized Dr. Garrett for not performing a biopsy in May 1989, substantially for the same reasons given by Dr. Leviss. In spite of its receipt of these reports, plaintiff never filed a direct claim against Dr. Garrett.

Just prior to trial, a settlement conference was conducted in which attorneys for all parties participated. Plaintiff settled with NHL for $900,000. NHL then filed a stipulation of dismissal with the court, reserving its claims against Dr. Garrett and informing him that it intended to continue with its third-party action.

On September 13, 1996, Dr. Garrett filed a motion for summary judgment, asserting that NHL was not entitled to common law indemnification because of its own admission that it was at least partially responsible for plaintiff's claims. In his motion, Dr. Garrett also argued that NHL could not pursue its right to contribution because a judgment was not entered between plaintiff and NHL, as required by the New Jersey Joint Tortfeasors Act, N.J.S.A. 2A:53A-3.

NHL conceded that its admission of partial responsibility prevented it from obtaining indemnification from Dr. Garrett. After receiving the consent of plaintiff's counsel, however, NHL cross-moved to vacate the stipulation of dismissal and enter a consent order of judgment pursuant to R. 4:42-2. Dr. Garrett responded to NHL's cross-motion by arguing that, even if the trial court entered the consent order, NHL would not be entitled to contribution because plaintiff never discharged her claims against Dr. Garrett as required by Young v. Steinberg, 53 N.J. 252, 250 A.2d 13 (1969).

The motion Judge granted Dr. Garrett's motion for summary judgment and denied NHL's cross-motion requesting vacation of the filed stipulation of dismissal and entry of a consent judgment, reasoning that NHL would be unable to proceed with its contribution claim, even if its motion to vacate the stipulation of dismissal were granted. The motion Judge concluded that NHL was attempting to elevate the settlement to a judgment by an informal consent proceeding, rather than the formal court proceedings contemplated by the Young decision. Furthermore, the motion Judge found that the plaintiff's failure to discharge her claims against Dr. Garrett as required by Young was fatal to NHL's pursuit of a contribution claim under N.J.S.A. 2A:53A-3.

Additionally, the motion Judge determined that no basis existed for revoking the stipulation of dismissal which was on file with the court. He questioned whether the entry of the stipulation was an effort on NHL's part to avoid public disclosure and adverse publicity among medical practitioners. NHL's attorney represented that entry of a stipulation of settlement rather than a consent judgment was only the consequence of counsel's oversight. Exercising his discretion, the motion Judge concluded that it was not in the "interest of Justice" under R. 4:42-2 to vacate the stipulation of settlement and enter a ...

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