February 19, 2008
CHARLES V. ELSE, JR., PLAINTIFF-APPELLANT,
HARRY O'MALLEY, DEFENDANT-RESPONDENT.
On appeal from Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-1949-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued January 22, 2008
Before Judges Lintner and Graves.
Plaintiff Charles V. Else, Jr., is the son of Charles V. Else, who died on August 13, 1994. The court appointed defendant, Harry O'Malley, an attorney, as the Temporary Administrator of the Estate of Charles V. Else on November 15, 1994. Plaintiff appeals from a summary judgment order dismissing his complaint because it was filed after the applicable six-year statute of limitations expired. See N.J.S.A. 2A:14-1. We affirm.
The material facts are not in dispute. After plaintiff's father died, plaintiff initiated litigation regarding the disposition of the Estate's assets. That litigation was resolved pursuant to a Consent Order of Settlement (Consent Order) signed by Judge Parrillo on October 15, 1997. The Consent Order provided that the Estate was to transfer certain real property to plaintiff. The Estate was also to transfer a valid liquor license to operate a tavern on one of the properties within ninety days. In return, plaintiff agreed to release all of his claims against the Estate.
Paragraphs two and three of the Consent Order provided as follows:
2. The Estate shall take all necessary steps to ensure that Charles V. Else, Jr. will receive good and marketable unencumbered title to all real property located in Falls Township, Bucks County, Pennsylvania, in which the Estate possesses an interest including: (a) the Tavern property, (b) the rental real estate, and (c) vacant land all located on Newportville Road, Levittown, Falls Township, Bucks County, Pennsylvania. Harry O'Malley, Esquire, Temporary Administrator of the Estate of Charles V. Else, deceased, or his successor shall prepare all documentation to affect the transfer of title.
3. The Estate shall take all necessary steps to ensure that Charles V. Else, Jr. will receive through transfer, a valid liquor license for use in the operation of the Newportville Road tavern formerly known as the Pointe After Tavern, as well as any rights to back rents from tenants and rights of former operators of a bar to the extent such rights are held by the Estate. The parties recognize and agree that there may be Liquor Control Board administrative delay, and that the Estate may be unable to immediately complete a renewal and transfer of the above-referenced liquor license to Charles V. Else, Jr. In the event, however, that the Estate is responsible for the denial or unexcused delay for more than ninety days, in completing the transfer, then in that event Charles V. Else, Jr. shall have the right to bring an action to compel transfer of the license or the Estate shall pay to Charles V. Else, Jr. the value of the liquor license which shall be no less than One Hundred Thousand Dollars ($100,000.00) nor greater than One Hundred Fifty Thousand Dollars ($150,000.00). The exact value within the stated range shall be determined by an appraisal prepared by an appraiser mutually acceptable to the Estate and Charles V. Else, Jr. with such appraisal to be paid for by the Estate and ordered within fifteen (15) days of the expiration of the above-referenced ninety (90) day period. Any payment shall be made from the fund to be created in accordance with the provisions of paragraph 10 below.
Paragraph ten of the Consent Order states:
10. The parties recognize and agree that at present the Estate has no fund with which to make payments. The parties and all counsel agree to await the creation of such a fund and to permit Harry O'Malley, Esquire, Temporary Administrator of the Estate of Charles V. Else, deceased, or his successor to use his best judgment in cooperation with Jo-Ann Else and her children to create a fund sufficient to satisfy the expenses associated with the Estate of Charles V. Else as outlined in this agreement. The parties understand that Estate assets including the Pennington farm (Block 37, Lot 19, known as 115 Route #31) may be sold, and agree that the Temporary Administrator shall have discretion to make all necessary decisions to effectuate this agreement within a reasonable period of time, which it is understood may take a period of a year or more.
On April 20, 2005, approximately seven and one-half years after the entry of the Consent Order, plaintiff filed a four- count complaint against defendant. In the first three counts of the complaint, plaintiff alleged defendant breached the Consent Order by failing to transfer the properties and liquor license to him, and defendant violated his fiduciary duty as administrator by allowing the properties to fall into a state of disrepair. The fourth count of plaintiff's complaint alleged legal malpractice.
Discovery revealed defendant was willing to comply with the Consent Order by transferring to plaintiff the properties and the liquor license he was entitled to receive. But plaintiff was unwilling to accept the properties unless they were restored to the condition they were in at the time of his father's death, or the Estate provided him with the funds needed to repair the properties. During his deposition on April 28, 2005, plaintiff testified:
Q: Have you indicated that you're unwilling to accept the properties in their present condition with the liquor license?
A: Would you repeat the question.
Q: Are you unwilling to accept transfer of the deeds for the properties in question with the liquor license?
A: The understanding I had from Mr. O'Malley in one of his many promises, I was to receive the property in the condition it was in at the time of my father's death with a liquor license and ready to go as a business.
Q: I guess the answer to my question is that unless the buildings are put in the condition they were in, as you said, when your father passed away you are unwilling to accept transfer of the deeds; is that right?
A: I didn't say that, you did.
Q: Would you accept transfers of the deeds today with the property in the condition it's currently in?
A: Along with the funds to repair them, yes.
Q: How about if the funds weren't provided?
A: If the funds weren't provided, no, it's not the condition they were at the time of my father's death.
Q: Would you accept the deeds to the properties today if they were offered to you with the property in the current condition it's in with a liquor license?
A: As I've said, from the time I accepted the property, I will accept the property when it's in the condition it was at the time of my father's death. The estate is responsible to keep the property in the condition it was. There was no security, there was no insurance, there was no maintenance, there was nothing, which is the estate's responsibility. And as soon as they take care of their responsibility, I will gladly accept the properties.
Q: So in the current condition, the answer to the question is no?
On October 25, 2005, the trial court entered an order enforcing the Consent Order and, on December 7, 2005, the Estate deeded to plaintiff the properties he was entitled to receive.
On March 23, 2007, after hearing oral argument, the court granted defendant's summary judgment motion. In its written decision, the court noted plaintiff conceded during oral argument that the statute of limitations had run, but he asked the court "to consider equitable relief to extend the [s]tatute of [l]imitations." The trial court's findings also included the following:
The Consent Order of Settlement was filed in 1997. The first three counts of the plaintiff's Complaint arise from the alleged breach of fiduciary duty for failing to comply with the 1997 Consent Order of Settlement.
The Consent Order of Settlement required the transfer of the properties from the Estate to the plaintiff. Plaintiff had refused to accept the property until the [c]court signed an Order to Show Cause on October 7, 2005 requiring [p]laintiff to accept the transfer of good and marketable title by the Estate in compliance with the Consent Order of Settlement. The effect of the October 7, 2005 Order was that the plaintiff was not entitled to have the property in the condition it was in upon Charles V. Else, Sr.'s death.
On appeal, plaintiff contends equitable principles prohibit "the imposition of a strict statute of limitations deadline."
According to plaintiff, defendant promised him, "both before and after the October 15, 1997 Consent Order . . . that the continually deteriorating properties would be repaired and transferred to him." Under these circumstances, plaintiff argues the doctrine of equitable tolling should be invoked to prevent defendant from using the statute of limitations as a sword. See Dunn v. Borough of Mountainside, 301 N.J. Super. 262, 280 (App. Div. 1997) ("Statutes of limitation are primarily a shield to protect a defendant from having to defend stale claims. They should not be used as a sword by a defendant whose conduct contributed to the expiration of the statutory period."), certif. denied, 153 N.J. 402 (1998).
"The doctrine of equitable tolling is typically applied to relieve a plaintiff who has been induced or tricked by defendant into missing a deadline." Pressler, Current N.J. Court Rules, comment 36.4.1 on R. 4:5-4 (2008). Thus, the doctrine of equitable tolling may provide relief from the statute of limitations in some cases; however, the doctrine "requires the exercise of reasonable insight and diligence by a person seeking its protection." Villalobos v. Fava, 342 N.J. Super. 38, 52 (App. Div.), certif. denied, 170 N.J. 210 (2001).
In this case, plaintiff admitted at his deposition that he "wanted the properties [that he was going to receive from the Estate] in the condition they were at the time of [his] father's death as part of the settlement." And plaintiff confirmed that he sought to have the properties rehabilitated prior to the entry of the Consent Order:
Q: Did you take any action in court before the present proceeding to compel Mr. O'Malley to carry out the terms of the settlement, the transfer of the property and the transfer of the liquor license?
A: Oh, yes.
Q: You filed court proceedings?
Q: What actions did you take?
A: I contacted Mr. O'Malley numerous times about having the properties brought up to the condition they should be in. I wanted the deeds, I wanted the liquor license and I wanted my inheritance. Many times I called him about that.
Q: When did you, when was the first time that you started doing that, as best you remember, was it shortly after the settlement, was it a period of time after the settlement?
A: It was probably shortly after he took over as executor of the estate.
We conclude from this testimony that plaintiff was well aware of the condition of the properties prior to the entry of the Consent Order on October 15, 1997. Nevertheless, the Consent Order did not obligate the Estate to repair or rehabilitate the property that plaintiff ultimately received. "'Equity favors the vigilant,'" Thompson v. Monteiro, 58 N.J. Super. 302, 305 (Ch. Div. 1959), and in this case, the record confirms plaintiff failed to act with reasonable diligence.
There was, therefore, neither error nor abuse of discretion by the motion judge. The court correctly determined plaintiff's inaction justified summary judgment dismissing his complaint because it was filed beyond the statute of limitations.
© 1992-2008 VersusLaw Inc.