On appeal from the Superior Court of New Jersey, Law Division, Union County, Docket No. L-1066-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Sabatino and Simonelli.
Applying principles of the entire controversy doctrine, the Law Division dismissed the complaint of Glenn Boothby in the present action against Bette Melendez (the "second lawsuit"). The dismissal occurred after Melendez had obtained a judgment against Boothby in prior litigation (the "first lawsuit"). Because we are satisfied that the trial court did not abuse its discretion or misapply the law in terminating the second lawsuit, we affirm.
Here are the factual and procedural matters relevant to our consideration of the issues. The parties once had a romantic relationship, during which time Boothby cohabitated with Melendez at her residence. The house was solely titled in Melendez's name. She obtained mortgage loans on the house to help finance Boothby's business ventures, acting as the sole named borrower. Eventually the couple separated in February 2005, and Boothby moved out, leaving behind several personal items. Boothby also agreed to make monthly payments to Melendez on the mortgage loans.
When Boothby defaulted on his agreed-upon payments, Melendez filed a complaint against him in the Law Division in August 2005. In that first lawsuit, Melendez sought Boothby's payment of the past due mortgage installments. She also alleged that Boothby owed her other financial obligations, including reimbursement for late penalties charged on the mortgages, the return of monies she loaned to him for his business expenses and taxes, and a release from her co-guaranty of a lease for his business. Boothby filed an answer denying that he owed anything to Melendez. He also asserted various affirmative defenses. He did not, however, assert a defense of setoff, nor did he include in his pleading any counterclaim. As part of his responsive pleading, Boothby included a certification pursuant to Rule 4:5-1, attesting in part that "no other action or arbitration proceeding is contemplated."
While the first lawsuit was pending, Boothby asserted on at least four occasions, either directly or through his attorney, that he had left behind valuable personal property at the residence and that Melendez was responsible to him for those items. Specifically, in a letter to Melendez's attorney dated January 30, 2006, Boothby's counsel alleged that Melendez had improperly placed for auction a collection of Italian glass and certain oil paintings belonging to him. The letter threatened civil claims against Melendez for the alleged conversion and also stated that Boothby had already filed a report of stolen property with the local police department. Thereafter, in another letter to Melendez dated March 29, 2006, Boothby alleged that she had wrongfully sold his possessions that he had left behind in the house and that he intended to amend his pleadings in the first lawsuit to include these "antics . . . in a counterclaim." In a third letter, dated July 13, 2006, Boothby reiterated his intent to file such a counterclaim and that he also would "preserve [his ability to assert the claims] by filing a separate complaint."
Despite his ongoing belief that Melendez had converted his property, Boothby did not promptly seek leave of court to amend his pleadings in the first lawsuit to add a counterclaim for relief. Instead, Boothby waited until the eve of trial. He filed a motion to amend his answer, returnable on short notice for Friday, August 4, 2006, three days prior to the trial date of Monday, August 7, 2006. In his supporting certification, Boothby attested that "[i]n order to have all claims arising out of the same proceeding to be addressed, the defendant [Boothby] is requesting that the answer be amended" to include the counterclaim. The certification further acknowledged that "[i]n hopes of resolving the matters in the entirety, we have restrained ourselves [until now] from filing this complaint."
The trial court denied Boothby's belated motion for leave to amend and issued a corresponding order on August 18, 2006. Notably, Boothby did not seek to have the court revise the form of order to reserve his potential counterclaims for a subsequent action.
The first lawsuit was adjudicated in a bench trial before Judge Malone. After considering the parties' testimony and other proofs, Judge Malone found that the two parties had essentially acted as business partners and that the joint debts they incurred should be shared accordingly. In his written decision, Judge Malone found that the parties' joint obligations, including loan proceeds, penalties and tax liens, totaled $207,921.31, and that Boothby's share was $107,960.65.
The Law Division entered final judgment against Boothby in that amount on November 30, 2006. Neither party appealed that judgment. Nor did Boothby appeal the court's order of August 18, 2006, which had denied him leave to assert a counterclaim.
Seven months after the first lawsuit was tried, Boothby brought the second lawsuit. He filed a complaint against Melendez in the Law Division on March 23, 2007, alleging that after the parties had stopped living together, she had wrongfully sold various "antiques, antiquities, works of art and collectibles" that belonged to him. In that regard, the complaint referenced Boothby's police report, which had previously been mentioned in his January 30, 2006 letter to Melendez. The complaint sought redress based upon legal theories of conversion and deceit and also sought punitive damages.
As discovery proceeded in the second lawsuit, Boothby took the deposition of Melendez. In her deposition testimony, Melendez confirmed that she had sold certain items ...