On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. L-2350-01.
The opinion of the court was delivered by: Parrillo, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 10, 2007
Before Judges Lintner, Parrillo and Sabatino.
In this legal malpractice action, defendants Israel N. Eisenberg and his former law firm, Post & Schell, P.C., appeal from a final judgment awarding their former clients, plaintiffs Carbis Sales, Inc. (Carbis or plaintiff) and Safe Step Reinsurance, Inc. (Safe Step) $704,405.20 in damages. On appeal, defendants contend that the trial court erred in admitting the net opinion of plaintiffs' expert and in refusing them discovery of a memo prepared by an investigator retained by plaintiffs. Plaintiffs cross-appeal, arguing that the trial court erred in denying them a new trial on damages or additur.
Plaintiffs' legal malpractice claim arose out of their representation by defendants in an underlying products liability cause of action filed by Dennis Carr, who alleged that the ladder from which he fell was defectively altered by Carbis, a ladder distribution company. The facts adduced during that trial established that at the time of the accident on April 7, 1990, Carr was working as a poly-seal foam insulator for Red Lion Insulation (Red Lion) inside one of the homes under construction in a residential development (Carriage Park) being built by U.S. Homes. He had used a six-foot ladder manufactured by R.D. Werner (Werner), which he had positioned in the foyer in front of the main entry door, with a canister of Polycel on his back, in order to spray insulation around the seams of the door and the second-story window above. As he was descending the ladder, Carr heard a cracking noise and felt the ladder twist. He immediately jumped off to the left from a height of two or three feet and landed in a cut-out heating/air conditioning vent. Experiencing terrible back pain, Carr loaded the ladder onto his truck and left the development for home.
Carr was ultimately diagnosed with herniated discs at L4 and L5 and underwent a laminectomy in August 1990. He was out of work for almost a year-and-a-half, and thereafter, due to residual pain and numbness, claimed he was unable to return to work as an insulator. Instead, he found work as a truck driver at a reduced salary. Carr also maintained that his condition contributed to the demise of his marriage and rendered him unable to enjoy many recreational activities.
When Carr did not return to work on April 9, 1990, he was fired from his job by Dave Ryan, Red Lion's president. Ryan also retrieved the company truck and ladder from Carr's home. Sometime later, Carr called a fellow employee, Steve McMichael, who supposedly returned the ladder to Carr. According to Carr's expert's inspection, the ladder had been cut down from twelve feet to six feet by Carbis prior to the fall.
Carr filed his original complaint on January 3, 1992, alleging that U.S. Homes' structure where he fell was in a defective condition and that the defect was a proximate cause of his fall and injuries. Carr also asserted a strict liability claim against Werner, manufacturer of the ladder, and included as defendants "John Does 7-10" who, Carr claimed, "marketed, sold, distributed, shipped, and/or delivered the defective ladder, or were otherwise involved in placing the ladder into the stream of commerce." U.S. Homes joined Tempcon Corp., the HVAC subcontractor at Carriage Park, and Red Lion as third-party defendants. In October 1994, Carr amended his complaint substituting for John Doe 7, Carbis, who Red Lion claimed exclusively repaired all its ladders, alleging that Carbis was negligent in altering the twelve-foot ladder by cutting it down to six feet and then placing it in the stream of commerce by selling it to Red Lion.
U.S. Homes moved for summary judgment, arguing that the "sole basis" for being named a party defendant was Carr's "unsubstantiated assertion that the accident took place somewhere in Carriage Park," the development being built by U.S. Homes. U.S. Homes pointed out that Carr was unable to give an address or an exact location of the house where the accident occurred. It also noted that when Carr went to the development and identified two houses where the accident might have occurred, neither house had a vent cut out next to a stairway where, according to Carr, he fell from the ladder. The trial court granted U.S. Homes summary judgment on April 29, 1996.
Following suit, Carbis filed a two-prong motion for summary judgment, arguing: (1) the grant of summary judgment in favor of U.S. Homes constituted a finding that, as a matter of law, Carr was unable to prove how, when, and where his accident occurred and that no rational factfinder could resolve the disputed evidence in Carr's favor; and (2) Carr was unable to establish a reliable chain of custody regarding the alleged ladder, and was unable to identify the ladder as the one he was using on the date of the accident. In opposition, Carr submitted an affidavit stating that the ladder he fell from on April 7, 1990 was the same ladder he turned over to his attorney and was the same ladder retrieved for him by McMichael, who was employed by Red Lion at the time. In light of Carr's affidavit, the trial court denied Carbis' motion, concluding there were genuine fact issues as to product identification.
At the close of Carr's case, the complaint against Werner was dismissed. On its case-in-chief, Eisenberg, Carbis' trial attorney, presented evidence to the jury that: (1) Carbis, an experienced and reputable ladder repair company, could not possibly have repaired the ladder that Carr fell from; and (2) Carr could not establish the chain of custody for the ladder placed in evidence. However, despite the fact that the central fact issue was whether Carr had properly identified the ladder that was defective, Eisenberg failed to produce McMichael to ascertain whether he would corroborate Carr's account of the ladder's retrieval -- a version belied by a June 29, 1990 letter from Carr's attorney to Red Lion requesting production of the ladder. Eisenberg also did not offer into evidence photos depicting the height of the Carriage Park foyer windows, suggesting that a six-foot ladder would have been insufficient for the work allegedly performed by Carr, or proof that there was a twelve-foot ladder on Carr's truck. Nor did he call the engineering experts, Nicholas Colanzi and Raymond Sams, who had been instrumental to the other defendants' successful disposition based on Carr's description of his fall.*fn1
Moreover, Eisenberg did not produce a defense medical expert to testify about the effects of Carr's several subsequent accidents; about his statement in an unrelated 1992 deposition that his back was fine; or about the fact that he had not sought any medical treatment for his back since 1994. Eisenberg also chose not to call an economist to counter Carr's testimony on lost income.
At the close of Carr's case, the complaint against Werner was dismissed. The jury thereafter returned a verdict in favor of Carr and against Carbis, assessing damages in favor of Carr in the amount of $600,000 and damages to his wife in the amount of $100,000 on her consortium claim. Including prejudgment interest and counsel fees, judgment was entered in the amount of $1,005,842.27. Of this, Carbis actually only paid its $15,000 deductible, while Safe Step, its primary insurer, contributed its full policy amount of $500,000 ($395,000 of which went to Carr). Lexington Insurance Company, Carbis' secondary insurer, paid the remaining $500,000.*fn2
Subsequently, in April 2001, plaintiffs Carbis and Safe Step sued Eisenberg and his firm Post & Schell for legal malpractice.*fn3 At the jury trial, it was established that the law firm was hired to defend Carbis in the products liability action and Beth Wright, a member of the firm, was initially assigned to handle the matter. She proceeded to investigate the case and retained an expert, Johnson, who was prepared to testify that the ladder was unusable prior to the accident and could not have been repaired by Carbis. Wright, however, left the firm on June 16, 1997 and the Carbis file, which included 2400 pages of depositions, nine expert reports and various summary judgment motions, was reassigned to Eisenberg. Although Eisenberg claimed to have immediately commenced reviewing the file, he could not quantify any such time spent. Moreover, his timesheets prior to September 11, 1997, do not reflect any billable hours charged Carbis, and instead document that during this same time he was billing other clients an average of 56 hours per week.
Eisenberg's time records do document that he began preparing the case on September 11, 1997, five days before the ten-day trial began. He spent a recorded total of 20.3 hours in preparation, which did not include meeting or speaking with Samuel Cramer, who headed Carbis, or Paul Junius, a principal in the firm hired to manage all claims against Carbis. During this time, Eisenberg did not prepare any witnesses or any deposition summaries. His file contained no memos or notes other than eight "stickies" that he claimed constituted his deposition review system. He was unaware of, and consequently did not review, a surveillance tape of Carr obtained by another defendant that might have suggested that Carr was not as debilitated as claimed.
McMichael testified at the malpractice trial that he had never been asked by Carr to retrieve a ladder and that he did not do so. George Repko, who worked as Carbis' principal ladder repairer at the time of Carr's accident, reported that he could have been located in 1997 and that he would have testified at the trial had he been asked. He denied repairing the ladder in question, which was probably returned to Red Lion in a damaged condition because Red Lion refused to pay disposal fees for unsalvageable ladders. Repko followed an inspection list when repairing ladders, including ...