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Rand, Algeier, Tosti & Woodruff v. Braun

July 30, 2008

RAND, ALGEIER, TOSTI & WOODRUFF, PLAINTIFF-RESPONDENT,
v.
RAY BRAUN, DEFENDANT-APPELLANT,
v.
DAVID RAND, ESQ. AN ATTORNEY AT LAW OF THE STATE OF NEW JERSEY, THIRD-PARTY DEFENDANT/RESPONDENT.



On appeal from Superior Court of New Jersey, Law Division, Essex County, Docket No. L-2833-02.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued June 3, 2008

Before Judges Fuentes, Grall and Waugh.

Plaintiffs the law firm of Rand, Algeier, Tosti & Woodruff (the firm) filed suit against defendant Ray Braun seeking to collect $28,754.80 for legal services performed by the firm on Braun's behalf. Braun retained David Rand, an attorney employed by the firm, to represent him in a shareholder dispute that arose between Braun, as a fifty percent shareholder, and the corporation's other shareholder. The dispute involved the partition of eleven acres of land owned by the corporation.

Braun filed an answer, counterclaim and third-party complaint for legal malpractice against attorney David Rand. In the malpractice action, Braun alleged that David Rand and the firm failed to diligently represent him in the underlying shareholder suit. As a result of such negligence, Braun alleged that he sustained monetary damages when the land in dispute was sold to the other shareholder for less than fair market value at a private auction. Braun demanded a trial by jury on the claims raised in his counterclaim and third-party complaint.

After joinder of issue, plaintiff and third-party defendant Rand moved for summary judgment seeking: (1) dismissal of Braun's counterclaim and third-party complaint; (2) an order barring Braun's malpractice expert from testifying about whether a motion to enforce a settlement would have been successful in the underlying shareholder dispute; and (3) a judicial determination that the question of whether a partition action would have been successful must be decided by the trial court, and not by a jury. Braun filed a cross-motion for partial summary judgment on the question of liability for his affirmative claims, and the dismissal of plaintiff's complaint.

The motion judge denied the firm's and David Rand's motion to dismiss the counterclaim, granted the motion to bar Braun's malpractice expert from testifying as to the successfulness of a motion to enforce the settlement, denied Braun's cross-motion for summary judgment and reserved decision on whether the trial court, and not a jury, should hear and decide the partition issue.

Thereafter, the court granted a second motion filed by the firm and David Rand, barring the testimony of Braun's expert, James Bank, because discovery had closed. The same judge finally decided the issue she had previously reserved decision on, holding that it would be too complicated to have a jury give its best estimate as to what a chancery court judge would have decided. The judge thus concluded that the first phase of Braun's legal malpractice suit, (the so-called trial within a trial) would proceed as a bench trial. If Braun prevailed, the malpractice case would then proceed to a jury trial on the issue of proximate cause and damages.

On September 14, 2004, Braun filed a motion with this court seeking leave to appeal the trial court's interlocutory rulings. We denied the motion for leave to appeal on October 19, 2004.

The bench trial on the question of whether the chancery judge would have found a partition of the land to be a proper remedy began on July 25, 2005. It lasted a total of four trial days, finishing on July 29, 2005. On November 2, 2005, the trial court placed its ruling on the record, finding that a partition of the property between Braun and the shareholder would not have been an available remedy. On November 14, 2005, the trial court entered an order dismissing Braun's claims against the Rand Firm and David Rand.

On December 11, 2006, the parties appeared before a different Law Division judge for proceedings related to the firm's complaint against Braun for legal fees. At that proceeding, counsel for the firm informed the trial court that Braun wished to appeal the order dismissing his counterclaim and third-party complaint. In addressing the trial judge, plaintiff's counsel noted, however, that, "given the fact that there was still an outstanding fee claim, any appeal would be interlocutory."

In an attempt to circumvent this jurisdictional impediment, plaintiff's counsel stated for the record that the parties had reached the following agreement:

[The firm] would take a dismissal without prejudice, thus allowing the -- with no --no agreement one way or the other with respect to the amount of monies owed or not owed by Mr. Braun, which would thereby enable [Braun] ...


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