On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, Hudson County, Docket No. DC-020712-07.
The opinion of the court was delivered by: Gilroy, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted October 23, 2008
Before Judges Winkelstein, Gilroy and Chambers.
Defendant Luis Alberto Lucas Cisneros appeals from the November 14, 2007 judgment entered against him in the Law Division, Special Civil Part, in the amount of $6,000, together with $64 in court costs. The issue presented on appeal is whether a judgment entered in favor of a business entity is voidable on appeal when the business entity was not represented by an attorney authorized to practice law in this State as required by Rule 1:21-1(c). Because we determine that the judgment is voidable on the election of the adverse party, we reverse and remand for a new trial.
Plaintiff is a limited liability company of New Jersey. In August 2005, plaintiff entered into an agreement with defendant Cisneros and defendant Daniel Fusaro for their creation of two websites at a cost of $6,000 each. The agreement required plaintiff to pay $4,000 down; $2,000 within thirty days; and the balance in installments as agreed upon prior to completion of the project. Although plaintiff paid the first two installments totaling $6,000, defendants failed to complete the websites by the agreed-upon date of October 31, 2005.
Plaintiff demanded that defendants either complete the websites or return the $6,000. On August 28, 2007, after defendants failed to comply with plaintiff's request in both respects, plaintiff, through its officers, Eric Wurtenberg and Craig Wurtenberg, filed a complaint in the Special Civil Part. The defendants filed separate answers denying the allegations asserted. On December 14, 2007, following a bench trial, the judge rendered an oral decision in favor of plaintiff and against defendants. The Court Clerk entered judgment accordingly. R. 6:6-5. Cisneros appealed, but Fusaro did not.
On appeal, Cisneros argues the trial judge erred by: 1) permitting plaintiff's officers to prosecute the action, contrary to Rule 1:21-1(c); and 2) failing to make findings of fact and state the conclusions of law supporting her decision as required by Rule 1:7-4(a).
Rule 1:21-1(c), with certain exceptions not applicable here, provides that a business entity, other than a sole proprietorship, is required to appear in court through an attorney authorized to practice law in the State. Although both parties agree that it was improper for plaintiff to have filed and prosecuted its complaint through its officers, neither of whom were attorneys, they disagree as to the effect of plaintiff's failure to comply with Rule 1:21-1(c) when neither the trial judge prohibited the officers from prosecuting the action, nor had defendants objected. Cisneros contends that plaintiff's failure to be represented by an attorney rendered the trial judgment void ab initio,*fn1 requiring a vacation of the judgment and remand for a new trial. Plaintiff counters that the judgment is voidable, not void ab initio, but asserts that the judgment may only be voided if there was some material irregularity in the trial proceeding or if the judgment was erroneously entered.
Although not so stated, plaintiff's argument is that of plain error, that is, because defendant did not object in the trial court, we should disregard its failure to comply with Rule 1:21-1(c) "unless it is of such a nature as to have been clearly capable of producing an unjust result." R. 2:10-2. We conclude that a judgment entered in favor of a business entity when the entity was not represented by an attorney authorized to practice law in this State as required by Rule 1:21-1(c) is voidable at the election of the adverse party without a showing of a material irregularity in the trial proceeding or that the judgment was otherwise erroneously entered.
The Supreme Court is vested with the ultimate authority to make administrative rules governing practice and procedure in the courts. State v. J.M., 182 N.J. 402, 415 (2005); N.J. Const. art. VI, § 2, ¶ 3. The Court's constitutional authority and concomitant responsibility to regulate the practice of law includes, "'the power to permit the practice of law and to prohibit its unauthorized practice.'" In re Opinion 33 of the Comm. on the Unauthorized Practice of Law, 160 N.J. 63, 77 (1999) (quoting In re Opinion No. 26 of the Comm. on the Unauthorized Practice of Law, 139 N.J. 323, 326 (1995)); N.J. Const. art. VI, § 2, ¶ 3.
Pursuant to its constitutional authority, the Court promulgated rules governing who may appear in court. R. 1:21-1. Subsection (c) of that rule prohibits business entities, subject to the limited exceptions contained in the rule itself, from appearing in court unless represented by an attorney. "Except as otherwise provided . . . a business entity other than a sole proprietor shall neither appear nor file any paper in any action in any court of this State except through an attorney authorized to practice in this State." R. 1:21-1(c).
A limited liability company exists pursuant to the authority extended by the Legislature under the New Jersey Limited Liability Company ...