Before Judges Muir, Jr., Cuff and Lesemann.
The opinion of the court was delivered by: Lesemann, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
On appeal from the Superior Court of New Jersey, Law Division, Middlesex County.
The opinion of the court was delivered by
Sometime before August 1994, decedent T.D., a hemophiliac, became infected with HIV from the infusion of impure anti-hemophiliac factor blood concentrate (the Factor). The Factor is a commercial product produced by several pharmaceutical companies, many of whom were sued by recipients of contaminated blood. Decedent T.D. filed such an action in the Superior Court of New Jersey. The suit was removed to the United States District Court in New Jersey, and thereafter transferred to the United States District Court for the Northern District of Illinois, where it became part of a class action suit.
On August 12, 1994, decedent died of AIDS as a result of the HIV infection. The suit continued both as a Wrongful Death Action under N.J.S.A. 2A:31-1 to -6, and as a survivorship suit, seeking benefits under N.J.S.A. 2A:15-3 for damages incurred by the decedent prior to his death.
In October 1996, the class action was settled. Under the settlement, each living person who had been infected by the Factor during the years 1978 through 1985, was entitled to receive $100,000. For any infected person who had died, the $100,000 was to be paid to that person's "claimant group," defined essentially as those persons who would receive derivative claims through the decedent.
Judge John F. Grady of the District Court in Northern Illinois, who had presided over the litigation and settlement, established a procedure for resolving disputes among claimant group members concerning the allocation of the $100,000 payment. Essentially, claimants could either submit their claims to a Special Master appointed by the judge, who would hear the matter and make his recommendation to the court; or alternatively, the claimants could pursue an arbitration procedure to be administered by the American Arbitration Association. While one of those dispute resolution procedures was taking place, all claimants were to sign releases directed to the pharmaceutical companies who were advancing the settlement funds. Each $100,000 payment was then to be held by the MetLife Trust Company under the supervision of the court until disbursed pursuant to the court's order.
The suit on behalf of decedent T.D. had been maintained in Illinois by plaintiff F.F., a sister of decedent, who had also been named as executrix and sole beneficiary under his will. She claimed that the $100,000 settlement proceeds were payable to decedent's estate (and thus to her as sole beneficiary of the estate), and she rejected competing claims by a number of decedent's other siblings. However, instead of proceeding to resolve that dispute via one of the procedures established by Judge Grady, plaintiff filed the present action in Superior Court in Middlesex County, New Jersey.
In an affidavit supporting her New Jersey complaint, plaintiff stated that she brought this action "to establish her exclusive rights to the proceeds" of the settlement. She sought and obtained an order to show cause, asking the court to direct payment of the proceeds to her as executrix of the estate.
The defendants maintain that issues relating to entitlement to the $100,000 should be resolved in Illinois, where the action had been prosecuted and settled, and where the court had established procedures to resolve such disputes. They also deny plaintiff's claim to the settlement funds, noting that at least part of the $100,000 represents settlement of a Wrongful Death Action under N.J.S.A. 2A:31-1 to -6, and the proceeds of such an action are not payable to a decedent's estate.
Following oral argument, the trial court entered an order providing that the settlement funds "are hereby awarded to the Estate" of the decedent. The court then directed that "distribution of the funds by the executrix" shall be stayed for forty-five days "during which time the monies shall be held in the trust account of plaintiff's counsel."
In their appeal, defendants note that, although plaintiff claims the court's order represents only a determination to hold the funds in New Jersey pending final determination as to entitlement, the order actually embodies a determination that the estate--rather than the defendants--are entitled to all of the funds. Defendants claim that determination preempts them from arguing their right to at least a portion of the $100,000, and they argue further that the determination of entitlement should properly be ...