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Neuhart v. Trust Company of New Jersey

June 17, 2008


On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-380-05.

Per curiam.


Submitted February 27, 2008

Before Judges Axelrad, Sapp-Peterson and Messano.

Plaintiff J. Michael Neuhart appeals from two orders, one dated May 3, 2007, and a second dated June 5, 2007, that together dismissed his complaint with prejudice for failure to comply with the applicable statute of limitations. Plaintiff contends that the judge erred in finding the complaint was untimely because the statute was tolled by: 1) defendants' intentional concealment of facts that delayed the filing of the complaint; 2) defendants' continued actions that independently gave rise to separate recurring causes of action; and 3) defendants' "continuing" course of conduct that made his complaint timely filed. We have considered these contentions in light of the record and applicable legal standards. We affirm.


Plaintiff filed a four-count complaint on February 3, 2005, against defendants Trust Company of New Jersey (TCNJ), his former employer, and Alan Wilzig, the former chairman, president and chief executive officer (CEO) of TCNJ.*fn1 Plaintiff alleged that: defendants failed to properly classify him as an employee (count one); defendants failed to honor the terms of his severance package "as embodied orally, by past practice, or in their respective [h]andbooks" (count two); Wilzig was personally liable for failing to pay the appropriate severance amount (count three); and defendants failed to provide him with payments and credits under their ERISA plan (count four).*fn2 The matter was removed to federal court based upon the allegations in count four; however, pursuant to a stipulation executed by all parties on May 24, 2005, the complaint was remanded back to the Superior Court with the parties agreeing that count four of the complaint would be amended to substitute "Stock Option Plan" for any reference to an "ERISA Plan."

Upon remand, defendants filed a motion to dismiss arguing that plaintiff's claims were time-barred under the statute of limitations. Noting that the complaint alleged plaintiff was "hired" by defendants on November 7, 1995, the judge dismissed count one because it was "barred on its face" by the six-year statute of limitations applicable to contract claims. N.J.S.A. 2A:14-1. Plaintiff was granted leave to file an amended complaint, which was ostensibly the same as his original one with the exception of a more detailed predicate statement of common facts and a modified first count. Of particular relevance to the issues raised on appeal, plaintiff contended that he "discovered on or about October 6, 1999 that he had been misclassified" as a consultant instead of an employee of defendants.

On October 20, 2006, defendants moved for summary judgment reasserting the statute of limitations defense. Pursuant to Lopez v. Swyer, 62 N.J. 267 (1973), on February 6, 7, and 8, 2007, the motion judge held a plenary hearing to determine whether plaintiff's complaint was timely filed by application of the discovery rule.

Plaintiff testified that in the fall of 1995, he met with Michael Marinelli, TCNJ's chief financial officer, to discuss a position within the bank's real estate department. Following that initial interview, plaintiff met with Siggi Wilzig, then chairman, president and CEO of TCNJ, and negotiated his compensation package.*fn3 Plaintiff acknowledged that although he wanted to be an employee of TCNJ, Siggi told him he "could not have [plaintiff] as . . . an employee," and therefore plaintiff accepted a position as a consultant, or "independent contractor." Plaintiff was to be paid a base salary of $85,000 plus other compensation, including bonuses and "2500 [stock] options immediately" and "every year" thereafter. The agreement plaintiff reached with Siggi was never reduced to writing, and on November 7, 1995, plaintiff started working at TCNJ with full knowledge that he was not an employee, but rather a consultant.

Plaintiff did not receive any stock options upon joining TCNJ and when he raised the issue shortly after his start date, Siggi told him "don't worry about it." In late 1995 or early 1996, plaintiff discovered through conversations with Marinelli and others at the bank that he was ineligible for stock options under TCNJ's then-current stock option plan because he was not an employee.

Plaintiff testified that from 1996 through 1998, he raised the issue of his missing stock options with Siggi at least twice a year and was told each time by Siggi that he would "take care of it." Although Marinelli and others reiterated that plaintiff was ineligible to receive options because he was not an employee, plaintiff testified that these other people also told him that if Siggi said he would do something, he would do it. Plaintiff claimed that he believed Siggi would resolve the issue favorably.

On June 28, 1999, plaintiff provided a memo to Siggi that set forth his request for increases in compensation and addressed his concerns regarding the 1995-1998 stock options. He wrote, "[W]hen I first joined you in 1995 I was insured (sic) of annual options starting at 2,500 shares and increasing each year." In October 1999, defendants reclassified plaintiff as an employee of TCNJ retroactive to January 1, 1999, and provided him with additional compensation, including stock options for 1998 and 1999.

The memo setting forth the new compensation terms was denominated an "Employment Agreement" by its author, Robert McCarthy, TCNJ's vice-president of human resources, and requested plaintiff's countersignature to indicate his acceptance. The memo failed to address stock options for years prior to 1998, however, and when plaintiff brought this omission to Siggi's attention, he was told not to worry and that this "other stuff" would be dealt with "later." Plaintiff refused to sign the agreement without the inclusion of stock options for the earlier years because by its terms, the agreement was intended to supersede any and all prior agreements.

Plaintiff continued to raise the issue of the missing stock options with Siggi, Alan, Marinelli, and McCarthy. Plaintiff testified that while he was often told not to worry about it, sometime between 1999 and 2004, Alan reiterated that he was ...

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