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Paragon Contractors, Inc. v. Peachtree Condominium Association

April 27, 2009


On appeal from the Superior Court of New Jersey, Law Division, Gloucester County, Docket No. L-292-07.

The opinion of the court was delivered by: Fisher, J.A.D.



Submitted January 22, 2009

Before Judges Fisher, C.L. Miniman and Baxter.

In this appeal, we reject the argument that the trial court's failure to schedule the case management conference, required by Ferreira v. Rancocas Orthopedic Associates, 178 N.J. 144 (2003), tolled the time to file or otherwise excused the malpractice claimant's failure to timely file an affidavit of merit. In so holding, we express our disagreement with that part of the decision of another panel, Saunders v. Capital Health System, 398 N.J. Super. 500, 510 (App. Div. 2008), which held to the contrary.


The Affidavit of Merit statute, N.J.S.A. 2A:53A-26 to -29, requires a claimant "in a malpractice action to serve on a defendant within 120 days of receipt of the answer an expert's sworn statement attesting that there exists a 'reasonable probability' that the professional's conduct fell below acceptable standards." Ferreira, supra, 178 N.J. at 146. The purpose of the Affidavit of Merit statute is "to require plaintiffs in malpractice cases to make a threshold showing that their claim is meritorious, in order that meritless lawsuits readily could be identified at an early stage of litigation." In re Petition of Hall, 147 N.J. 379, 391 (1997). Despite its simple and clear requirements, the Affidavit of Merit statute "has generated a tide of litigation." Ferreira, supra, 178 N.J. at 146.

The Court has repeatedly observed that embodied in the Affidavit of Merit statute is a "dual purpose" -- "to weed out frivolous lawsuits early in the litigation while, at the same time, ensuring that plaintiffs with meritorious claims will have their day in court." Hubbard v. Reed, 168 N.J. 387, 395 (2001). As a result, the Court has declared that "[t]he failure to deliver a proper affidavit within the statutory time period requires a dismissal of the complaint with prejudice." Ferreira, supra, 178 N.J. at 146-47; see also N.J.S.A. 2A:53A-29 (declaring that the failure to timely provide the affidavit required by the Act "shall be deemed a failure to state a cause of action"); Alan J. Cornblatt, P.A. v. Barow, 153 N.J. 218, 244 (1998) (holding that "[t]he violation giving rise to the dismissal goes to the heart of the cause of action as defined by the Legislature"). The Court, however, has also recognized "two equitable remedies that temper the draconian results of an inflexible application of the statute." Ferreira, supra, 178 N.J. at 151. First, the Court has held that a complaint must not be dismissed if plaintiff has "substantially complied" with the Act. Palanque v. Lambert-Woolley, 168 N.J. 398, 405-06 (2001). And, second, the dismissal may be without prejudice if there are "extraordinary circumstances to explain noncompliance." Ferreira, supra, 178 N.J. at 151.

Because the substantial compliance doctrine is based "on justice and fairness," and "designed to avoid technical rejection of legitimate claims," it requires that the claimant show a lack of prejudice to the opposing party, a "series of steps" taken to comply with the statute, a "general compliance" with the purpose of the statute, "reasonable notice" of the claim, and "a reasonable explanation why there was not a strict compliance with the statute." Galik v. Clara Maass Med. Ctr., 167 N.J. 341, 352-53 (2000). Substantial compliance has been found: where claimant's counsel, before initiating suit, provided defendants' insurers with a detailed expert report that established the legitimacy of the complaint, id. at 357-58; where a timely served affidavit of merit and extensive expert's report clearly focused on the conduct of the defendant even though the report and affidavit did not name the defendant doctor, Fink v. Thompson, 167 N.J. 551, 561-64 (2001); and where the claimant timely served a certification instead of an affidavit, Cornblatt, supra, 153 N.J. at 239-42. On the other hand, the Court has found a lack of substantial compliance where the claimant was in possession of an expert's report before filing suit but failed to provide defendant with the report or an affidavit within the 120-day time period, Palanque, supra, 168 N.J. at 405, and where plaintiff's counsel was in possession of an affidavit of merit within ten days of the filing of the answer but took no steps to serve it until after the passage of 120 days from the filing of the answer, Ferreira, supra, 178 N.J. at 152-53.

In Ferreira, the Court observed that it has "yet to define the full scope of extraordinary circumstances as an equitable remedy for failure to comply with the statute," but emphasized that "attorney inadvertence" and "counsel's carelessness in misfiling defendant's answer and failing to calendar" the matter do not constitute extraordinary circumstances. Ibid.

The Court has also recognized that a defendant's conduct in seeking enforcement of the Affidavit of Merit statute may at times render it inequitable to dismiss a malpractice suit. In concluding that the Affidavit of Merit statute was "not intended to encourage gamesmanship or a slavish adherence to form over substance," the Court held in Ferreira that a defendant should be estopped from claiming entitlement to dismissal where the claimant "possessed the affidavit of merit almost at the time the clock began to run and served the affidavit before defendants filed a motion to dismiss." Id. at 153-54. The Court summarized the rule it announced in Ferreira in the following way:

In a case where the plaintiff has in hand an affidavit within the 120-day statutory period and serves the affidavit on defense counsel outside that time frame but before defense counsel files a motion to dismiss, the defendant shall not be permitted to file such a motion based on the late arrival of the affidavit. If defense counsel files a motion to dismiss after the 120-day deadline and before plaintiff has forwarded the affidavit, the plaintiff should expect that the complaint will be dismissed with prejudice provided the doctrines of substantial compliance and extraordinary circumstances do not apply. That formulation places strong incentives on both plaintiffs' and defense counsel to act diligently.

[Id. at 154.]

The Court has also applied the doctrines of estoppel and laches in holding that dismissal is not warranted where the defendant participated in discovery and waited a considerable period of time after passage of the 120-day deadline before seeking dismissal pursuant to the Affidavit of Merit statute. Knorr v. Smeal, 178 N.J. 169, 178-81 (2003).

Finally, in an effort to ensure that disputes about a claimant's compliance with the Affidavit of Merit statute "do not become sideshows to the primary purpose of the civil justice system," the Court in Ferreira "propose[d] that an accelerated case management conference be held within ninety days of the service of an answer in all malpractice actions." Ibid.*fn1 As explained,

Expediting the schedule in malpractice cases will further the intent of our Best Practice rules: to resolve potential discovery problems before they become grist for dueling motions. At the conference, the court will address all discovery issues, including whether an affidavit of merit has been served on defendant. If an affidavit has been served, defendant will be required to advise the court whether he has any objections to the adequacy of the affidavit. If there is any deficiency in the affidavit, plaintiff will have to the end of the 120-day time period to conform the affidavit to the statutory requirements. If no affidavit has been served, the court will remind the parties of their obligations under the statute and case law.

. . . The painful experience of our affidavit of merit jurisprudence reveals the compelling need for such conferences at an early stage before problems arise. Indeed, our proposal serves the very goal of case management; it will "assist discovery . . . [and] promote the orderly and expeditious progress of the case." R. 4:5B-2. We trust that early intervention in the discovery process will permit the Affidavit of Merit statute to fulfill its true purpose -- to bring a swift demise to frivolous lawsuits while allowing meritorious ones to have their day in court. [Id. at 154-55.]

In her separate opinion in Ferreira, Justice Long "deem[ed] it unlikely that the court's innovation" of requiring management conferences prior to the expiration of the 120-day period "will forestall a new round of litigation"; instead, she saw that innovation "as simply moving the field of battle to a different ...

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