On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. L-7634-95.
The opinion of the court was delivered by: Coburn, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Coburn, Wecker and S.L. Reisner.
Plaintiff, Connell, Foley & Geiser, LLP ("Connell Foley"), sued its former clients, defendants Israel Travel Advisory Service, Inc., and its principals ("ITAS"), for legal fees incurred while acting as counsel in a trial that resulted in a verdict against ITAS of over $8 million. ITAS responded with an answer and later with a counterclaim and third-party complaint, alleging that the judgment on the verdict resulted from malpractice committed by Connell Foley and one of its partners, third-party defendant Thomas Cosma, who tried the case. Connell Foley and Cosma impleaded the fourth-party defendants, seeking contribution on allegations that they committed legal malpractice, either as co-counsel or as successor counsel in the underlying trial and unsuccessful appeal.
Connell Foley and Cosma moved for summary judgment on ITAS' malpractice claims based solely on the entire controversy doctrine, and Connell Foley moved for summary judgment on its complaint. The fourth-party defendants moved for summary judgment on the malpractice claims alleged against them by Connell Foley and Cosma. The trial court denied the fourth-party defendants' motions, dismissed ITAS' malpractice claims, and entered a $339,055.34 judgment on Connell Foley's complaint.
ITAS and the fourth-party defendants appeal.
Since ITAS' malpractice claim was filed after Olds v. Donnelly, 150 N.J. 424 (1997), was decided, it is not barred by the entire controversy doctrine. That the claim accrued during the brief hegemony of Circle Chevrolet Co. v. Giordano, Halleran & Ciesla, 142 N.J. 280 (1995), is irrelevant under Olds' limited retroactivity ruling. Since Connell Foley's money judgment was primarily based on dismissal of the ITAS malpractice claim, it must be reversed and remanded for trial along with the trial of ITAS' claims of malpractice against Connell Foley and Cosma.
To the extent that Connell Foley's claims against the fourth-party defendants are based on actions taken as successor counsel in the underlying case, they are barred by Olds' separate determination that successor counsel may not be impleaded in these circumstances. Therefore, we reverse the ruling allowing Connell Foley and Cosma to pursue successor-counsel claims. On the other hand, we see no sound reason for extending the Olds' successor-counsel ruling to co-counsel. Therefore, we affirm the ruling allowing Connell Foley and Cosma to pursue malpractice claims for contribution against the fourth-party defendants who acted as co-counsel, and remand those claims for trial.
On October 10, 1989, when the underlying litigation began, ITAS was a New Jersey travel agency owned by Ceil Shar and her daughter, Marilyn Ziemke. It specialized in organizing group tours for families in the United States who wanted to celebrate religious rites in Israel. Shalom Almog and Ben Ami Geller had managed the tours for ITAS in Israel. In the New Jersey litigation, they alleged that ITAS, Shar and Ziemke were liable to them for, among other things, breach of contract, intentional infliction of emotional harm, and defamation.
ITAS asked its Illinois law firm, fourth-party defendant Seyfarth, Shaw, Fairweather & Geraldson ("Seyfarth"), to recommend a law firm to represent it in New Jersey. Seyfarth suggested Connell Foley, and ITAS retained that firm in August 1992. Later that year, Seyfarth filed suit for ITAS against Geller and others in Illinois. The action alleged that Geller and the other defendants had formed their own travel agency to compete with ITAS and had then defamed ITAS. These two cases, which were pending at the same time, shared many of the same witnesses and discovery. Connell Foley assigned its case to Thomas Cosma. Seyfarth assigned the Illinois litigation to two associates, fourth-party defendants Daniel J. Voelker and Christopher V. Langone, who, at ITAS' request, were also directed by Seyfarth to monitor and assist Cosma in his defense of the New Jersey action.
The primary support for the co-counsel malpractice claims by Connell Foley and Cosma against Seyfarth and its associates is Cosma's affidavit in opposition to the fourth-party defendants' motion for summary judgment. In summary, he affirmed that throughout the case he had "numerous communications with" Voelker and Langone, which included "substantive matters, such as the coordination and preparation of witnesses for the trial . . ., the assembling and presentation of evidence on behalf of the ITAS defendants during the trial, and the identification of issues for post-trial motions." He added that "Voelker attended four weeks out of the approximate five-week trial and, during that time, was an active participant, although not admitted as counsel of record or pro hac vice." Voelker continually conferred with Cosma about the conduct of the trial and strategy, and participated in trial preparation sessions at Connell Foley's office. Cosma also said that Voelker withheld information developed during the Illinois trial that was of critical importance to a proper presentation of the defense in the New Jersey case. Furthermore, he added, "there were few aspects of discovery and virtually no component of the trial that were not reviewed with Voelker for his approval and comment." During the trial, Voelker "was in direct and frequent communication with Mr. Langone at Seyfarth Shaw's offices in Chicago."
Cosma's affidavit was intended to buttress Connell Foley's allegations, which included these charges of malpractice: failure to provide information critical to the defense of the defamation action, and "knowingly permit[ting] Ziemke to offer testimony in the Defamation Action, on the issue of punitive damages, that was inconsistent with and contrary to testimony offered by Ziemke in . . . [the Illinois action] . . . ."
The Almog action jury trial began in July and ended in September 1993 with the return of the over $8 million verdict against the ITAS defendants, which was based, in part, on ...