On appeal from the Superior Court of New Jersey, Law Division, Sussex County, Docket No. L-0030-01.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Wefing, R. B. Coleman and Lyons.
Plaintiffs Genevieve and Paul Fager, and their counsel, Paul Abramo, appeal from the Law Division's orders dated April 29 and May 19, 2005, imposing monetary sanctions upon plaintiffs' counsel for failure to produce an expert report in the time frame required by the court's case management orders. They also appeal from the orders dated June 23 and July 11, 2006, which imposed additional monetary sanctions upon plaintiffs' counsel and dismissed the complaint without prejudice based upon counsel's failure to comply with the May 19, 2005, sanction orders.
Defendants Christopher Okechukwu, M.D. (Okechukwu) and Newton Memorial Hospital (Newton Memorial) cross-appeal from the Law Division's April 29, 2005, order to the extent the court denied their motions for summary judgment and dismissal of the complaint with prejudice and granted plaintiffs' cross-motion for an extension of discovery. We affirm in part, reverse in part, and remand for proceedings consistent with our opinion.
The following factual and procedural history is relevant to our consideration of the issues advanced on appeal. On January 25, 2001, plaintiffs filed a complaint against Newton Memorial and Okechukwu, alleging medical malpractice and loss of consortium. Plaintiffs alleged that Okechukwu deviated from the standard of care by failing to diagnose Genevieve Fager's skin cancer during an emergency room visit on March 10, 1996, and that Newton Memorial was liable for Okechukwu's negligence under the doctrine of respondeat superior.
Both Newton Memorial and Okechukwu filed answers denying liability and asserting cross-claims against one another.
The original discovery end-date was July 11, 2002. However, between 2002 and 2004, there were five orders extending discovery. First, by order dated July 1, 2002, the court extended discovery by two months, to September 9, 2002. Second, by order dated July 29, 2002, the court extended discovery by six months, to March 10, 2003, with plaintiffs' expert reports due by November 30, 2002. Third, by order dated March 3, 2003, the court extended discovery by another eight months, to November 30, 2003, with plaintiffs' expert reports due by May 15, 2003. Fourth, by order dated August 15, 2003, the court extended discovery by another six months, to May 15, 2004, with plaintiffs' expert reports due by October 31, 2003. Fifth, by order dated January 26, 2004, the court extended discovery for another seven months, to December 31, 2004, with plaintiffs' expert reports due by May 15, 2004.
In February 2001, just one month after the complaint was filed, Okechukwu served written discovery requests. Four months later, in June 2001, when plaintiffs still had not responded, Okechukwu filed a motion to compel. He ultimately withdrew that motion, however, based upon a representation from plaintiffs' counsel that the discovery responses were forthcoming. Okechukwu filed a second motion to compel in September 2001, after the discovery responses were not served in accordance with counsel's representation. However, he withdrew that motion after plaintiffs served their responses on October 18, 2001.
Plaintiffs' failure to serve expert reports also resulted in motion practice. For example, in June 2002, with the original discovery end-date approaching in July, Okechukwu moved for summary judgment based upon the lack of an expert report substantiating plaintiffs' claims. However, that motion was denied, and plaintiffs' cross-motion to extend discovery, which Okechukwu did not oppose, was granted.
In addition, in January 2003, after Okechukwu's deposition had been completed, Okechukwu moved to dismiss the complaint based upon plaintiffs' failure to respond to defendant's notice to produce. The record does not reflect a disposition of that motion, but it reflects a consent order dated March 3, 2003, extending discovery.
In July 2004, when plaintiffs had not produced their expert report by the deadline of May 15, 2004, Okechukwu's counsel wrote to plaintiffs' counsel and questioned the status of the report. He received no response to his correspondence. Accordingly, in July 2004, both Newton Memorial and Okechukwu moved for summary judgment, seeking dismissal of the complaint with prejudice based upon plaintiffs' failure to substantiate their malpractice claims with an expert opinion.
In September 2004, plaintiffs filed opposition to defendants' motions and a cross-motion to extend the time for serving their experts' reports. In his certification dated September 1, 2004, plaintiffs' counsel identified plaintiffs' expert as Dr. Reed Oxman (Oxman), a teaching physician at the Medical College of Pennsylvania. Counsel stated that he had "received oral reports" from Oxman on the issues of liability and damages, and had "advanced substantial sums of money" to Oxman to prepare an expert report. However, Oxman was out of the country on a summer sabbatical, and he could not complete his report until the end of September 2004. In addition, counsel certified that he had consulted with and was in the process of engaging an expert dermatologist and/or oncologist on the issue of damages. Finally, counsel certified that he had been unable to attend to the engagement of such experts until mid-May 2004, after the reports were to have been served on May 15, 2004, due to "his attendance to various conflicting professional and personal matters," including a wrongful death action pending in federal court in which he served as counsel, and the death of a member of his immediate family.
Defendants opposed plaintiffs' cross-motion, and argument was heard on September 10, 2004. At that time, the trial court reserved on all pending motions and cross-motions. The court later explained that it refrained from entering an order in September 2004 based upon plaintiffs' counsel's representation at oral argument that his expert report would be served no later than October 15, 2004.
In any event, no order was entered on the motions until April 2005. During the period between September 2004 and April 2005, no discovery was taken and, most significantly, plaintiffs' counsel did not produce an expert report as promised, nor did he communicate with opposing counsel or the court regarding the difficulties he was experiencing with his expert.
After the September 2004 hearing date, by computer-generated notice dated October 23, 2004, the court advised counsel that discovery would end on December 30, 2004, and that if no motion were made to extend discovery, the case would be scheduled for arbitration or trial.
Thereafter, in November 2004, Okechukwu filed a motion to extend discovery. Counsel explained that he made this motion for the sole purpose of protecting his client's interests. He asserts the motion was made as a defensive maneuver because the discovery deadline was approaching in December 2004, there was no expert report received from plaintiffs' counsel, and there had been no resolution of defendants' motions for summary judgment.
Plaintiffs consented to Okechukwu's request for a discovery extension. However, Newton Memorial did not. By letters dated December 13, 2004, and January 18, 2005, Newton Memorial inquired about the status of its motion for summary judgment, and it expressed opposition to Okechukwu's request for an extension of discovery, should summary judgment be denied.
By computer-generated order dated January 24, 2005, the court advised the parties that trial was scheduled for March 28, 2005. However, the parties were subsequently advised that the trial date had been adjourned, and a case management conference was scheduled for April 2005.
By case management order dated April 11, 2005, the trial court allowed plaintiffs to file an expedited motion to extend discovery, with a return date of April 29, 2005.
Plaintiffs filed the motion allowed by the court, requesting an extension of discovery to December 30, 2005, with plaintiffs' expert reports to be served no later than June 30, 2005. Plaintiffs' counsel explained that yet another discovery extension was necessary because in the fall of 2004 he had experienced difficulty with his former expert, Oxman, which resulted in the termination of that relationship in December 2004. Four months later, in April 2005, he had retained Drs. Marc Borenstein and Allan Halpern, and these experts had committed to generating their expert reports by June 30, 2005.
Okechukwu opposed plaintiffs' motion. He cited: misrepresentations plaintiffs' counsel had made to the court regarding the status of expert discovery; both court-imposed and self-imposed discovery deadlines that plaintiffs' counsel had missed; plaintiffs' counsel's failure to communicate with opposing counsel regarding the alleged difficulties he experienced with his expert; and the harm suffered by Okechukwu due to the ongoing pendency of this medical malpractice litigation.
On April 29, 2005, the trial court heard argument regarding the pending motions. At that time, the court advised counsel of its inclination to grant plaintiffs' request for an extension of discovery, albeit "with the utmost reluctance," and only on the condition that the new schedule will not be deviated from under any circumstance. . . . And I want [plaintiffs' counsel] to communicate this to his client loud and clear, that if this schedule is not adhered to . . . that the time lines will not be expanded, they will not be relaxed on the plaintiffs' side, notice I said on the plaintiffs' side, for any reason short of a major, major calamity which would have to be impressive in dimension.
In addition, I will, as a condition of granting that relief, and again, this is what I'm contemplating doing, is directing that the plaintiff[s] be responsible for counsel fees and costs incurred by the defendants on these motions and conferences that have occurred. Any motions filed, court appearances involved and conferences that have taken place between May 15, 2004, through today, April 29, 2005.
It further suggested that plaintiffs would have sixty days to pay any counsel fees ordered, and, if they did not pay those fees, the complaint would be subject to dismissal.
The court found that this proposal, which would constitute a "significant sanction," was justified by plaintiffs' counsel's failure to communicate with opposing counsel regarding the problems he was experiencing with his expert, and plaintiffs' counsel's failure to file for an extension of discovery in April or May 2004, when he knew there was a problem and he would not be able to comply with the case management order.
After stating this proposed disposition of the pending motions, the court heard from plaintiffs' counsel, who argued against the imposition of monetary sanctions. Counsel stated this his clients were "dirt poor," and the sanctions the court was considering "would be a devastating blow." The court responded that it would take that issue into account. At the conclusion of the hearing, the court entered an oral decision consistent with its proposed disposition of the motions.
Thereafter, by case management order dated April 29, 2005, the trial court extended the overall discovery end-date to December 30, 2005, with plaintiffs' expert reports to be served no later than June 30, 2005. In paragraph seven of the order, it ruled that: "The time frames set forth above as to Plaintiff's discovery obligations shall not be relaxed, expanded or extended." In paragraph eight of the order, the trial court ruled that:
Counsel for defendants may . . . submit Certifications as to Counsel fees and costs and reasonable and documented costs incurred by any party . . . between May 15, 2004 and April 29, 2005, (May 15, 2004 being the deadline for Plaintiff[s] to serve expert reports), . . . which the Court shall consider as a consequence of the Plaintiffs' failure to timely serve expert report(s) by May 15, 2004 and the Plaintiffs' failure to promptly advise the Court and Counsel for defendants as to now-reported problems with her medical expert (Dr. Oxman), and the failure of plaintiff[s] to file a motion for extension of discovery on a timely basis prior to May 15, 2004. Any Order of this Court directing Plaintiff[s] to pay Counsel fees and costs, and documented costs of parties Defendant, (if any), shall be complied with within 60 days, or the Plaintiffs' Complaint shall be subject to dismissal with prejudice on motion.
Finally, in paragraph nine of the order, the court ruled that, if plaintiffs did not serve expert reports by the deadline of June 30, 2005, defendants would have leave of the court to refile their motions for summary judgment seeking dismissal of the complaint, and "as to any Plaintiff's expert whose report is not served by June 30, 2005, that expert's testimony shall be barred at the time of trial."
Defendants filed certifications as to counsel fees and costs they had incurred as a result of plaintiffs' failure to timely serve expert reports by May 15, 2004. In their correspondence to the court, they requested that the sanctions be imposed upon plaintiffs' counsel, however, rather than the individual plaintiffs, since it was counsel's conduct that had resulted in the excessive delays and extra costs. Defendants agreed to waive the sanctions if the court were inclined to impose them against the individual plaintiffs.
Plaintiffs' counsel submitted written opposition to defendants' submissions, requesting that the court defer entry of a sanctions order pending plaintiffs' motion for reconsideration. Newton Memorial opposed that request.
Thereafter, by separate orders dated May 19, 2005, the court ordered plaintiffs' counsel to pay $2250 to counsel for Newton Memorial, and $2250 to counsel for Okechukwu. The trial court further ordered that no portion of those amounts shall be billed to or otherwise passed on to plaintiffs. Moreover, the fees and costs were to be paid within ...