December 4, 2008
MAXIMUM QUALITY FOODS, INC., PLAINTIFF-RESPONDENT,
SALVATORE IMBRIANO, DEFENDANT-APPELLANT, AND PISA FOODS, INC., A/K/A, T/A, D/B/A PISA FOODS, DEFENDANT.
On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-1419-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 8, 2008
Before Judges Sapp-Peterson and Alvarez.
This is an appeal from an April 27, 2007 order suppressing defendant Salvatore Imbriano's*fn1 answer for failure to comply with discovery, a June 22, 2007 order denying him summary judgment, and a July 20, 2007 order awarding plaintiff Maximum Quality Foods, Inc., $843.75 in counsel fees. For the reasons that follow, we affirm.
The procedural history in this case compels the outcome. After the complaint was filed on March 29, 2005, defendant moved, pursuant to Rule 4:6-2(e), to dismiss for failure to state a claim. He asserted that as a matter of law he could not be found personally liable because he was protected by the corporate form of his business, Pisa Foods, Inc., a/k/a, t/a, d/b/a Pisa Foods (Pisa Foods), also a named defendant in the suit. The motion judge found that "sufficient factual issues existed regarding [defendant's] compliance with the corporate forum," and denied the motion on July 13, 2005. No answer was filed on behalf of defendant individually or on behalf of the corporation. A default judgment was entered against both defendants on August 18, 2005.
On September 26, 2005, the default judgment as to the individual defendant was vacated, and he filed an answer on October 3, 2005. The default judgment against Pisa Foods was never vacated and remains in effect.
Defendant's answer was subsequently dismissed without prejudice on January 20, 2006, as a result of defendant's failure to answer interrogatories. On February 3, 2006, defendant was ordered to produce documents, including personal and corporate tax returns.*fn2 He did not oppose the application or seek to modify the order after its entry. On July 7, 2006, pursuant to Rule 4:23-5(a)(1), plaintiff suppressed defendant's answer without prejudice for failure to appear at a deposition.
Defendant's answer was reinstated on January 11, 2007, conditioned upon his appearance at a deposition and payment of costs. The matter was unsuccessfully arbitrated on February 28, 2007, and was listed for trial on July 9, 2007.
On April 27, 2007, plaintiff obtained, again unopposed, a third order suppressing defendant's answer. On this occasion, the relief was granted because defendant had never complied with the February 3, 2006 order requiring him to produce personal and corporate tax returns and other corporate documents.
The court thereafter learned that on April 24, 2007, defendant filed a motion for summary judgment that was, as the judge put it, "styled" as a cross-motion, and which was intended to act as opposition to plaintiff's motion to suppress. The judge was unaware of the belated filing when she granted the motion to suppress defendant's answer. The summary judgment notice of motion indicated the same return date as the motion to suppress the answer, April 27, 2007, only three days after the date of filing. Because the motion was untimely, it was relisted for June 22, 2007.
On May 11, 2007, defendant sought reconsideration, pursuant to Rule 4:49-2, of the April 27, 2007 order suppressing his answer. On May 17, 2007, plaintiff filed a cross-motion for counsel fees. The motion for reconsideration was denied, and counsel fees were awarded at oral argument on June 22, 2007.
Defendant's motion for summary judgment was problematic, as the judge explained on June 22, 2007:
The summary judgment motion . . . violated Rule 1:6-3(b) in that the subject matter of the cross-motion did not relate to the original notice of motion which was with regard to a discovery issue. The motion was filed with the Civil Division on April 24, 2007, purporting to have a return date of April 27, 2007. Rule 4:46-1 provides that a motion for summary judgment shall be filed and served not later than 28 days before the time specified for the return date. The motion therefore was not timely.
And defendant's motion failed to include both a brief and statement of material facts as required by Rule 4:46-2(a). The motion was then given a return date of today, June 22, 2007, to allow counsel to correct the deficiencies. However, as of the point in time that the motion was filed, the answer had been stricken and obviously the defendant would be precluded from seeking affirmative relief by way of summary judgment when its answer and defenses [have] been stricken.
The judge therefore declined to consider the motion on its merits.
The initial complaint was filed in this case because plaintiff, a food wholesaler, sought to collect on a book account in the amount of approximately $32,117 against both defendants. As defendant received shipments, he would issue post-dated checks on the Pisa Foods corporate bank account. Once Pisa Foods was no longer operational, defendant advised plaintiff that any checks previously exchanged for food deliveries would not clear because the Pisa Foods account was closed.
Defendant's points on appeal are:
THE TRIAL COURT ERRED BY FAILING TO GRANT THE DEFENDANT/SHAREHOLDER SUMMARY JUDGMENT FOR CLAIMS AGAINST THE CORPORATION BASED UPON LIMITED LIABILITY OF CORPORATE OWNERSHIP.
THE TRIAL COURT ERRED BY NOT GRANTING THE DEFENDANT'S MOTION TO REINSTATE THE ANSWER AND DEFENSES UNCONDITIONALLY, ONCE THE INTERROGATORIES ANSWERS WERE PROVIDED TO PLAINTIFF.
THE TRIAL COURT ERRED BY FINDING THAT THE INDIVIDUAL DEFENDANT MUST PROVIDE HIS PERSONAL TAX RETURNS TO THE PLAINTIFF IN DISCOVERY WITHOUT A SHOWING OF NEED FOR SUCH PRIVATE AND PRIVILEGED INFORMATION.
We concur with the motion judge that for procedural reasons, defendant's arguments on the merits cannot be reached. We therefore limit our discussion to the issues described in plaintiff's notice of appeal, namely, the orders dismissing defendant's pleadings and defenses and the order awarding fees and costs.
We also note that "[a]n appeal may be taken only from a final judgment, Rule 2:2-3(a)(1), and a judgment is final only if it is final both as to all issues and all parties." Caggiano v. Fontoura, 354 N.J. Super. 111, 123 (App. Div. 2002). The order suppressing defendant's answer without prejudice is not final. To this date, defendant can comply with the February 3, 2006 discovery order and reinstate his answer. Defendant should have filed a motion for leave to appeal. See R. 2:2-3 and R. 2:2-4. In the interest of justice, however, and with the expectation that this appeal will finally dispose of the matter, we exercise our discretion to grant leave to appeal nunc pro tunc. See Caggiano, supra, 354 N.J. Super. at 125. This case has a needlessly tortured procedural history. We will therefore address the issues despite our policy against consideration of appeals when leave to appeal was required but not sought. See Vitanza v. James, 397 N.J. Super. 516 (App. Div. 2008).
The first order from which an appeal is taken, dated April 27, 2007, suppressed defendant's answer because he failed to produce individual and corporate returns and other corporate documents, as mandated by the February 3, 2006 order. He contends that because the February 3, 2006 order was issued in error, the suppression for failure to comply was issued in error as well. Defendant cannot, however, fourteen months after the fact, complain that production of the documents is oppressive. As a result, we discern no error in the judge's suppression of the answer for failure to comply with discovery.
Defendant submits in the alternative that because he provided answers to interrogatories and a few corporate documents, he satisfied the terms of the order sufficiently such that suppression was not warranted. As the most important item to be produced was defendant's personal income tax return, that argument cannot prevail either. The only defense raised to the complaint is that defendant is protected from liability by the corporation. Given the motion judge's initial ruling that there were factual questions as to defendant's "compliance with the corporate forum," production of defendant's personal income tax return and of all corporate documents is absolutely necessary.
Defendant also complains that when the judge denied his motion for summary judgment on June 22, 2007, she did so in error because he was shielded by the corporate form of business from personal liability. At the time that the motion was heard, defendant's answer had not been reinstated and, as a result, he was barred from seeking summary judgment or any other form of affirmative relief.
Defendant further asserts that the judge should have granted reconsideration of the order suppressing his answer because of the alleged unfairness of the February 3, 2006 order. Reconsideration can only be granted where the court relied on plainly incorrect reasoning, failed to consider evidence, or there is other good reason for it to evaluate new information. Cummings v. Bahr, 295 N.J. Super. 374, 384-85 (App. Div. 1996). None of the enumerated grounds are present here. Thus, it was not error for the court to have denied relief.
At oral argument for reconsideration, defendant repeatedly attempted to address the merits of the discovery order. As the judge said, "[T]he defendant at this juncture has . . . one alternative, and that is to respond to the notice to produce, fully and completely, and to make a motion before this [c]court to reinstate the answer." See R. 4:23-5(a)(1). Defendant elected not to pursue that option and chose to take this appeal instead.
Initially, in April 2007, the court denied plaintiff's request for counsel fees. Fees were awarded, however, at the June 22, 2007 hearing. The judge reasoned that plaintiff had been put to the trouble of responding to an initially improperly filed motion for summary judgment, and was required to do so after defendant failed to effectively oppose the motion to suppress the answer. She therefore directed counsel to submit an affidavit of services. No objection is made to the actual amount of fees, but only to the award itself. Here, defendant's failure to timely respond to the motion to suppress the answer, and the initial belated filing of a motion for summary judgment, without a brief or supporting certifications, warrants the award. See R. 1:2-4(b).