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Triffin v. Elite Personnel

May 13, 2010


On appeal from Superior Court of New Jersey, Law Division, Essex County, Docket No. DC-9454-09.

Per curiam.


Argued March 24, 2010

Before Judges Payne and Miniman.

Plaintiff, Robert J. Triffin, appeals from an order of a judge of the Law Division, Special Civil Part, dismissing his complaint against Elite Personnel, Inc. and Deus Dajuste with prejudice. We reverse.

This matter has a history. Triffin is "in the business of purchasing dishonored checks and taking assignments from the sellers by which he seeks to recover as holder in due course from banks and others in the collection process." Triffin v. Automatic Data Processing, Inc., 394 N.J. Super. 237, 241 (App. Div. 2007). As the just-cited case suggests, ADP is among those companies from which recovery was sought. It resisted payment, and in the course of discovery in the lawsuit that ensued, ADP determined that the purported assignors never signed the individual assignments that Triffin attached to the complaint. Id. at 244. Further, Triffin "acknowledged he had scanned the individuals' signatures into his computer and then using his computer 'pasted' them on to assignment forms he had on his computer." Ibid. Discovery revealed, as well, that the purported assignors had not agreed to the specific terms contained in the assignments. Id. at 245. When this evidence became known, ADP filed a counterclaim alleging common-law fraud, RICO violations, and negligence. Following an eight-day trial before Judge Goldman, a jury held Triffin liable for common-law fraud. However, its award of damages in ADP's favor was substantially reduced by the trial court on various theories.

The parties cross-appealed. On appeal, we found that the trial record clearly supported the conclusion that Triffin had knowingly and materially misrepresented a presently existing or past fact in connection with the assignments with the intent that ADP rely upon the authenticity of those agreements and, therefore, recognize Triffin as a holder in due course and make payment on the dishonored checks. Id. at 247. However, we found that the record did not demonstrate that ADP either took or refrained from taking steps to protect its interests as the result of Triffin's misrepresentation that the assignments were authentic. Accordingly, we held that ADP had not established all elements of common-law fraud, and we reversed the judgment in ADP's favor. Id. at 248-49.

Nonetheless, we condemned Triffin's conduct, recognizing it as constituting a potential fraud on the court - as to which reliance need not be demonstrated. Id. at 249-51. We therefore remanded the matter to the trial judge for further proceedings. Id. We stated:

Following a hearing, the trial court may impose sanctions on plaintiff on its own motion or on the application of defendant, or both. In determining whether sanctions are appropriate, the trial court shall exercise reasonable discretion, recognizing the caution which must be exercised in invoking its powers and complying with the mandates of due process. [Id. at 253.]

On remand, Judge Goldman found, by clear and convincing evidence, that Triffin had committed a fraud on the court in the matter. Accordingly, he entered an order assessing ADP's counsel fees and costs in the amount of $44,000 against Triffin. On appeal from that aspect of the opinion, we affirmed. Triffin v. Automatic Data Processing, Inc., 411 N.J. Super. 292 (App. Div. 2010). Additionally, Judge Goldman entered sanctions in favor of the court in the form of an injunction, applicable statewide to civil proceedings, that required, for a period of one year commencing on September 1, 2008, that Triffin attest to the unaltered form of documents submitted to the court and to the authenticity of signatures contained on them in one of three fashions, depending on whether the signatures, as submitted, were original, copies or facsimiles, or both. The order further provided for enforcement either by the judge before whom a violation occurred or by Judge Goldman.

In the present matter, Triffin did not comply with Judge Goldman's order in accordance with the judge's clear intent. Rather, he offered an omnibus certification that set forth the language concerning original signatures, copies or facsimiles, or both without specifying which was applicable, thereby reducing the court's ability to recognize a violation by Triffin and order sanctions. After finding noncompliance with Judge Goldman's order, the trial judge dismissed the matter with prejudice.

Triffin has appealed. On appeal, Triffin denominates Judge Goldman's statewide injunction as a procedural rule, entered without the proper constitutionally derived authority. We disagree, regarding the injunction to have been a prophylactic disciplinary measure that appropriately addressed a course of conduct that had been found to have constituted fraud on the court. In this regard, we note that Judge Goldman's certification requirement was limited in time. Further, it did not in any material fashion prohibit access by Triffin to the courts. It simply provided a policing mechanism, designed to insure that pleadings and evidence in Triffin's matters properly and truthfully reflected the underlying facts of those matters. We have been offered nothing to suggest that Judge Goldman lacked the inherent power to issue such an injunction, which regulated only Triffin's conduct. Indeed, in a related context, the entry of court-wide injunctions against the filing of frivolous actions is frequently recognized as a lawful exercise of judicial power, so long as principles of due process are honored. See, e.g., Rosenblum v. Borough of Closter, 333 N.J. Super. 385 (App. Div. 2000); see also Gilgallon v. Carroll, 153 Fed. Appx. 853 (3d Cir. 2005); Perry v. Gold & Laine, P.C., 371 F. Supp. 2d 622 (D.N.J. 2005). Moreover, although in the course of his order Judge Goldman recognized the power of his colleagues to impose judicial sanctions upon Triffin should he violate the order' provisions, Judge Goldman did not mandate that his colleagues employ any such sanctions.

We also reject Triffin's contention that the trial judge in this matter lacked jurisdiction under Judge Goldman's order to sanction Triffin's violation of the judge's order. Such jurisdiction was specifically authorized by paragraph 4 of the order, which recognized the court in which the violation occurred as a proper venue for sanction proceedings. Moreover, we read Judge Goldman's order, as did the trial judge, to require Triffin, not the court, to make an initial determination as to which of the three certifications of authenticity and lack of alternation was applicable to the present matter and to offer that certification in connection with his complaint in the case.

We find, however, that the judge's imposition of the sanction of a dismissal with prejudice, without setting forth a sufficient basis, or indeed any articulated basis for that relief, was a mistaken exercise of his discretion. In all cases in which sanctions may be imposed, the court must assess the facts, including the willfulness of the violation, the prejudice to the adversary, the proximity of trial, and the availability of a cure in determining the appropriate remedy. Casinelli v. Manglapus, 181 N.J. 354, 365 (2004). Further, the court must bear in mind the fact that a dismissal with prejudice "'is drastic punishment and should not be invoked except in those cases where the actions of the party show a deliberate and contumacious disregard of the court's authority.'" Kosmowski v. Atlantic City Med. Ctr., 175 N.J. 568, 575 (2003) (quoting Allegro v. Afton Village Corp., 9 N.J. 156, 160-61 (1952)). Thus, a dismissal with prejudice should be issued "'only sparingly.'" Ibid. (quoting Zaccardi v. Becker, 88 N.J. 245, 253 (1982)). In the present matter, the judge did not engage in the fact-finding necessary to sustain a conclusion that the ultimate ...

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