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Hillside Golf, Inc. v. Gino Inn

July 22, 2010

HILLSIDE GOLF, INC., FAIRFIELD DELTA, INC., AND GURMAIL SINGH, PLAINTIFFS-RESPONDENTS,
v.
GINO INN, INC., DEFENDANT, AND GINO E. INNARELLA, AND RACHEL INNARELLA, DEFENDANTS-APPELLANTS.



On appeal from the Superior Court of New Jersey, Law Division, Morris County, L-2751-05.

The opinion of the court was delivered by: R. B. Coleman, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued July 8, 2009

Before Judges R. B. Coleman and Graves.

Defendants Gino E. Innarella and Rachel Innarella appeal from the March 28, 2005 order denying their motion to vacate final default judgment and for leave to file an answer out of time.*fn1 The motion judge determined that the proofs submitted by plaintiffs established that the summons and complaint were properly served and that "[defendants'] active choice not to serve an answer in this matter does not constitute excusable neglect." We affirm the order from which defendants appeal.

On September 28, 2005, plaintiffs Hillside Golf, Inc., Fairfield Delta, Inc., and Gurmail Singh, filed a complaint against defendants Gino Inn, Inc., Gino E. Innarella, and Rachel Innarella, alleging that defendants were responsible for the environmental remediation of property located at 37 Clinton Road, in Fairfield, the Property, because an environmental investigation of the Property revealed a gasoline or petroleum contamination of the soils and surface groundwater pre-dating the Agreement and Lease. It is undisputed that plaintiffs successfully served defendant Gino Inn, Inc. with the summons and complaint through its agent on December 21, 2005; however, Gino E. Innarella and Rachel Innarella (the Innarellas), the principals of Gino Inn, assert that to the best of their knowledge and recollection they were never personally served with the summons and complaint in this civil action.

Plaintiffs' attorney certified that: (a) "several attempts were necessary to serve" the Innarellas individually; (b) the Summons and Complaint were first sent via New Jersey Lawyer Service on October 3, 2005 but were refused and returned; (c) service was resent via United States certified mail, return receipt requested but was unclaimed and returned; and, (d) defendants were personally served on December 29, 2005 at their home address by a private server, Guaranteed Subpoena.

The Affidavits of Service (Affidavits) returned by the private server reflect that the Innarellas were successfully served at 26 Clinton Avenue, Fairfield, New Jersey, by Gino Innarella's acceptance of the Summons and Complaint on his own behalf and on behalf of his wife, Rachel Innarella, on December 28, 2005 at 4:40 p.m. The Affidavits describe Mr. Inarella as a white male with grey hair between fifty-one and sixty-five years-old, between five feet, four inches (5'4") and five feet, eight inches (5'8") tall, and weighing over 200 pounds.

In contrast to the Affidavits of Service, Mr. Innarella certified in support of the Innarellas' motion to vacate default judgment that he: (a) is fifty-eight years old; (b) has dark brown hair; (c) has never dyed his hair; (d) is approximately five feet, eight inches tall (5'8"); (e) weighs approximately 170 pounds; (f) has never weighed 200 or nearly 200 pounds; (g) resides at 26 Clinton Road, Fairfield, New Jersey; (h) believes Fairfield does not contain a street named Clinton Avenue; and, (i) he never received service of process in this matter. The Innarellas, as principals of Gino Inn, Inc., acknowledge their awareness of plaintiffs' Summons and Complaint, but according to the certification of Mr. Innarella, "our attorney . . . advised that neither of us had to [a]nswer the [c]omplaint."

Mr. Innarella's certification stated further that their attorney advised them that they were not properly served, and that "for tactical and legal reasons, neither my wife nor I should take action to defend Gino Inn, Inc. . . . and that our best bet was to defend the personal allegations of the complaint when properly served." The Innarellas never filed an answer nor otherwise defended the complaint.

Plaintiffs' requests for entry of default against each of the defendants for their failure to file an Answer or otherwise defend pursuant to Rule 4:43-1 were filed in the Law Division on February 3, 2006. Plaintiffs' counsel certified that a copy of the filed Entry of Default was served on each defendant by ordinary mail and by certified mail, return receipt requested, and on June 6, 2006, plaintiffs requested final default judgment against defendants pursuant to Rule 4:43-2. Thereafter, on June 15, 2006, the court entered a final judgment in the amount of $609,340.62 against Gino Inn, Inc. Final default judgment was not then entered against the Innarellas individually due to plaintiffs' failure to provide (a) affidavits of non-military service, (b) support for entitlement to treble damages, and (c) support for entitlement to counsel fees.

Coincidental to plaintiffs' request for default and for default judgment, the court had issued a Dismissal Notice dated June 10, 2006, which notified plaintiffs that on August 9, 2006, the court would dismiss Gino Inn, Inc. for lack of prosecution, unless action was then taken pursuant to Rule 1:13-7 or Rule 4:43-2. A similar notice dated June 16, 2006, was subsequently sent to plaintiffs respecting a prospective dismissal of the action against the Innarellas on August 15, 2006, unless action required under the rules was taken. By letter dated August 14, 2006, plaintiffs again requested the entry of final default judgment against the Innarellas, and this time they provided the necessary affidavits of non-military service.

Final default judgment was entered on September 1, 2006. The order stated in relevant part that plaintiffs proved a loss of "$10,068.40 for environmental consulting, $30,680.05 for NJEP oversight costs and $554,600 for future remediation, and could "submit a revised [o]rder setting forth prejudgment interest and costs based on a loss of $567,737.05." The court denied plaintiffs' request for treble damages and legal fees under N.J.S.A. 56:8-2. The September 1, 2006 order was mailed to the Innarellas via United States certified mail at 26 Clinton Avenue, Fairfield; it was "refused" and returned to sender. On September 26, 2006, a revised order of final judgment by default reflecting prejudgment interest and costs was entered against the Innarellas in the sum of $692,756.10.

The Innarellas contend that they did not learn of the default judgment until they attempted to re-mortgage their personal residence. The Innarellas filed and re-filed their motion to vacate default judgment, arguing that the default judgment is void. They argue that they were not personally served and that default judgment was obtained more than six months after default was obtained without the filing of the required motions ...


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