December 17, 2010
HIGH POINT AT LAKEWOOD CONDOMINIUM ASSOCIATION, INC., PLAINTIFF-RESPONDENT,
DEFENDANT/THIRD PARTY PLAINTIFF-APPELLANT,
HONIG & GREENBERG, L.L.C., THIRD PARTY DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-1670-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued November 29, 2010
Before Judges Reisner and Sabatino.
Defendant Yoel Oshri seeks review*fn1 of the Law Division's entry of an amended judgment against him in the sum of $9,902.00, plus $1,980.40 in amended counsel fees and costs. Defendant also seeks review of the Law Division's dismissal with prejudice of his counterclaim against plaintiff, High Point at Lakewood Condominium Association, Inc., and his third-party complaint against the law firm of Honig & Greenberg, L.L.C., principally alleging violations of the Fair Debt Collection Protection Act, 15 U.S.C. §§ 1692-1692p ("FDCPA").
We need not detail the extensive procedural chronology of this litigation, which encompasses dozens of motions and orders in the trial and appellate courts, including an unsuccessful interlocutory application by defendant to the United States Supreme Court, various collateral attacks, fourteen transcripts, and numerous other materials in the appendices. Rather, it will suffice to state that the litigation arises out of efforts by plaintiff, a condominium association, to collect from defendant, a unit owner in the condominium complex, unpaid fees and other accrued charges. After filing liens against defendant's property by invocation of N.J.S.A. 46:8B-17, plaintiff retained the services of a law firm, third-party defendant Honig & Greenberg, to pursue a monetary recovery from defendant.
Defendant does not dispute that he has not paid the charges imposed by plaintiff, but instead he maintains that the charges are unjustified. He also contends that plaintiff has not fulfilled its obligations concerning the maintenance of the premises, that it imposed improper liens against him, and that it has engaged in various other forms of wrongful conduct and breaches of fiduciary duty.
On appeal, defendant raises numerous arguments in his brief and reply brief, including contentions that the court erred in:
(1) disregarding alleged false statements in correspondence from plaintiff's counsel; (2) dismissing the third-party complaint and not finding a violation of the FDCPA by the law firm; (3) granting plaintiff partial summary judgment; (4) accepting an allegedly improper certification from plaintiff; (5) relying upon unpublished authority when ruling in plaintiff's favor; (6) rendering judgments without adequate proof of the debt owed; (7) dismissing his counterclaim, which alleged breach of fiduciary duty and other wrongs by plaintiff; (8) dismissing the counterclaim before the completion of discovery; (9) allowing plaintiff to impose a lien under N.J.S.A. 46:8B-21(a) without proper notice; (10) allowing plaintiff to engage in an alleged conspiracy and in alleged racketeering; (11) failing to render decisions impartially and considering factual matters on personal knowledge in violation of N.J.R.E. 605; (12) improperly taking judicial notice of matters under N.J.R.E. 201(e); (13) entering a judgment without adequate proof that the underlying debt was timely and valid; (14) accepting false statements from respondents' counsel; and (15) accepting a brief from respondent that was not dated and signed.
Having fully reviewed the numerous arguments that defendant raises on appeal respecting the entry of the amended judgment and the dismissal of his third-party complaint, we conclude that those arguments manifestly lack merit and do not warrant discussion in this opinion. R. 2:11-3(e)(1)(E). As to those two discrete aspects of the case, we shall add only some brief comments.
The judgment entered in favor of plaintiff, as amended, followed a two-day proof hearing. Defendant attended that hearing, at which he testified and at which he was afforded an opportunity to cross-examine the testimony of plaintiff's witness, the association's secretary. The proofs adduced at that hearing, including the testimony and the related documentary exhibits discussed by the witness, provide substantial credible evidence that the charges*fn2 imposed by plaintiff were recoverable from defendant. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 483-84 (1974); see also Glen v. June, 344 N.J. Super. 371, 376-77 (App. Div. 2001) (observing that a unit owner's obligation to pay condominium fees is "unconditional"). The amended judgment issued by the trial court has reasonable support in the record. We therefore will not disturb it, subject to any offsetting judgment that may ultimately be entered with respect to defendant's counterclaim, which we shall discuss, infra. See Glen, supra, 344 N.J. Super. at 380-81 (noting that the condo association's breaches of duty allowed the unit owner to recover damages from the association, but that those breaches did not vitiate the owner's obligation to pay assessments due to the association).
The trial court's dismissal of the third-party complaint alleging violations of the FDCPA by plaintiff's litigation counsel is likewise sustained. The trial court correctly found that the law firm did not represent plaintiff at the time that allegedly-improper liens were filed against defendant. The trial court also reasonably determined that the law firm had a right to file the collection action in the Law Division against defendant when it did, even though he disputed the charges. Cf. Loigman v. Kings Landing Condo Ass'n, 324 N.J. Super. 97, 107 (Ch. Div. 1999) (finding a violation of the FDCPA where the recording of a lien for unpaid assessments occurred after the property owners disputed the validity of the debt).*fn3
We lastly consider the trial court's dismissal of defendant's counterclaim. The counterclaim was dismissed in the wake of sharp disputes over defendant's efforts to obtain discovery from plaintiff and over whether the court had prematurely scheduled an arbitration session in the case pursuant to Rule 4:21A-1. The pertinent chronology may be summarized as follows.
Prior to the discovery end date of January 15, 2008, defendant served interrogatories and other discovery demands upon plaintiff. Plaintiff did not respond to those discovery demands to defendant's satisfaction. After defendant complained about plaintiff's non-compliance, the judge then-assigned to the case ("the motion judge") entered an order on January 18, 2008 extending discovery. The motion judge also advised defendant that, if he believed that plaintiff had not provided discovery as required, he should file an appropriate motion to compel that discovery. Defendant filed such a motion, which was substantially granted by the court in a oral hearing on May 12, 2008, and confirmed in a written order dated May 27, 2008. In particular, the May 27, 2008 order compelled plaintiff to answer all but one of the outstanding interrogatories propounded by defendant, to designate a representative for depositions, and to produce certain documents.
Meanwhile, an initial arbitration had been scheduled for June 2, 2008. Defendant arrived late to the courthouse arbitration room on June 2, 2008. Defendant asserted that it was too soon to convene the arbitration because he was still awaiting discovery from plaintiff. Consequently, no arbitration was held that day, resulting in a wasted court appearance by plaintiff's counsel.
Plaintiff moved for sanctions. In opposition, defendant argued that plaintiff should first be required to appear for depositions and furnish the outstanding paper discovery. After hearing the parties' competing positions, the motion judge issued an order on June 23, 2008, directing plaintiff's representative to appear for a deposition on July 10, 2008, extending the discovery end date again, to August 10, 2008,*fn4 and adjourning the arbitration to August 21, 2008. In addition, on July 23, 2008, the motion judge issued an order sanctioning defendant for his failure to appear on time for the June 2, 2008 arbitration session and ordering him to reimburse plaintiff for $2,490.50 in counsel fees. Meanwhile, the Law Division administratively issued a notice rescheduling the arbitration to September 8, 2008.
Still dissatisfied with plaintiff's cooperation with discovery, defendant filed another motion*fn5 seeking to enforce his rights as a litigant, to compel discovery, and to once again extend discovery. The motion was marked returnable August 29, 2008. However, because the motion judge was going to be out on August 29, the court, sua sponte, adjourned the motion return date to September 12, 2008, i.e., four days after the September 8, 2008 rescheduled arbitration date.
On August 22, 2008, while his discovery motion was still pending, defendant sent a letter to the court requesting that the arbitration be rescheduled once again to enable his motion to be heard and the outstanding discovery to be completed. That application was unsuccessful and the arbitration date remained unaltered.
Both parties appeared at the courthouse on September 8, 2008, the second scheduled arbitration date. Defendant took the position that it was premature for the arbitration to go forward because he was still owed discovery by plaintiff and he had a motion pending to compel that discovery and to extend the discovery end date. The parties were referred to the civil presiding judge. After conferring by telephone with the motion judge about the status of the case, the presiding judge declined to adjourn the arbitration.
In the course of the presiding judge's oral ruling, he advised defendant that the motion judge had "already denied your [request for an] extension [of] discovery." Defendant responded that he had been unaware that the motion judge had denied his request for an extension, and that he had not received a written order documenting such a denial. Even so, the presiding judge concluded that defendant was obligated to participate in arbitration that day. The presiding judge instructed a sheriff's officer to escort defendant out of the courtroom and down to the arbitration room. Although the record is not clear as to what exactly occurred next, it appears that an arbitration of the merits of the counterclaim did not take place that day and no written award was issued by the arbitrators.
The record reflects that, as a result of these events, the presiding judge issued an order, dated September 12, 2008, dismissing defendant's counterclaim without prejudice. In the "comments" section of that order, it states: "Case dismissed/Plaintiff [sic] Yoel Oshri refused to arbitrate case."
Meanwhile, on September 11, 2008, the motion judge entered an order denying defendant's motion to compel discovery, to enforce litigant's rights, and to extend discovery. Defendant then moved to vacate the court's without-prejudice dismissal of his counterclaim. In addition to reiterating his position that the arbitration was premature because of the outstanding discovery, defendant raised a new argument--that his counterclaim was not subject to mandatory arbitration under Rule 4:21A because he had classified his counterclaim on his case information statement as a "real property" matter. On December 5, 2008, the motion judge entered an order denying defendant's motion to vacate the dismissal.
Defendant then moved for reconsideration. Plaintiff subsequently cross-moved to have the court convert the dismissal of the counterclaim without prejudice to a dismissal with prejudice. After considering the parties' contentions, the motion judge denied reconsideration to defendant and granted plaintiff a dismissal of the counterclaim with prejudice. During the course of the oral argument on these motions on March 20, 2009, defendant asserted that he had acted appropriately because he filed his motion to compel discovery before the discovery end date and made the application returnable before the arbitration date. The motion judge responded that he would "check the records as to the various dates and write a letter opinion."
Subsequently, the motion judge entered an order on March 24, 2009, denying defendant's motion for reconsideration and granting plaintiff's motion to dismiss the counterclaim with prejudice. Because that order was erroneously labeled, a corrected order was issued on March 31, 2009. This appeal by defendant followed.
As a matter of law, we reject defendant's assertion that his counterclaim was not subject to the Law Division's mandatory arbitration program under Rule 4:21A because he had unilaterally identified it as a "real property" matter on his case information form. Rule 4:21A-1(a)(3) provides that, in addition to automobile negligence and personal injury actions, mandatory arbitration is also required in "[a]ll actions on a book account or instrument of obligation . . . and all other contract and commercial actions that have been screened and identified as appropriate for arbitration[.]" Plaintiff brought the instant litigation as a book account complaint, and defendant's counterclaim responding to the complaint is sufficiently in the nature of a commercial dispute to justify mandatory arbitration under Rule 4:21A-1(a). The case type label selected by defendant is not controlling.
We recognize that the Rules of the Court contemplate that arbitration ordinarily is not to be scheduled for a date prior to the discovery end date. R. 4:21A-1(d). That requirement was met in this case, as discovery had expired nearly a month before the September 8, 2008 arbitration date. We are mindful that defendant filed a motion to again extend the discovery deadline; however, that motion was not granted.
Although defendant, a self-represented litigant, may well have been uncertain about the status of his motion for an extension when he appeared at the courthouse on September 8, 2008, it was incumbent upon him to comply with the court's dictates and to participate fully in arbitration that day, regardless of whether he thought he had a right to abstain from the process. The trial court acted within its reasonable zone of discretion when it sanctioned defendant for not taking part in the arbitration; first, for his tardy appearance*fn6 on June 2, 2008 and, second, for his failure*fn7 to arbitrate on September 8, 2008. See Bender v. Adelson, 187 N.J. 411, 428 (2006) (noting that orders of the trial court respecting discovery-related matters are to be sustained on appeal, absent a demonstration that the trial court abused its discretion). The arbitration was a non-binding and non-evidential proceeding, and defendant could have nullified an adverse outcome in the arbitration by simply demanding a trial de novo within thirty days and paying the requisite $200 towards the arbitrator's fee. See R. 4:21A-6.
When the presiding judge denied defendant's request to adjourn the
arbitration under Rule 4:21A-1(c), defendant was obligated to proceed
with the arbitration regardless of whether he felt it would be
unproductive to do so. Given the circumstances, the presiding judge
acted within his authority in entering the order on September 8, 2008
dismissing the counterclaim without prejudice. See also R. 4:21A-4(f)
(providing that if a party claiming damages does not appear*fn8
for arbitration, "that party's pleading shall be dismissed").
We have less confidence, however, with respect to the motion judge's ensuing conversion of the dismissal of the counterclaim without prejudice to a dismissal with prejudice. A dismissal with prejudice operates as a final adjudication on the merits. Consequently, the Rules generally provide for a two-step process to encourage non-compliant litigants to cure their obligations after first receiving an order dismissing, without prejudice, the delinquent party's claims, before subsequently entering an order disposing of the matter with prejudice when such a default is still not cured. Cf. R. 4:23-5(a)(1) and (2) (outlining the analogous two-step process for dismissals without prejudice, and then with prejudice, for failures to comply with pretrial discovery obligations). See also St. James AME Dev. v. Jersey City, 403 N.J. Super. 480, 483-84 (App. Div. 2008).
Although the motion judge, who is now retired, assured defendant at the March 20, 2009 final hearing that he would consult the court records concerning the relevant dates and then issue a letter opinion expressing his reasons concerning the ultimate disposition of the counterclaim, we have been supplied with no such letter opinion and it appears that the motion judge did not issue one before he retired. Nor do the implementing orders dated March 24 and March 31, 2009, both of which were evidently prepared by the court, recite a statement of reasons. The absence of such a statement of reasons is troublesome, not only because the motion judge anticipated writing a letter opinion, but also because the absence of a statement of reasons impedes our function of appellate review. See Pressler & Verniero, Current N.J. Court Rules, comment 1 on R. 1:7-4 (2010) (emphasizing that the Rule "requires findings to be made on all motions decided by written orders appealable as of right," and "the critical importance of that function"); see also Vartenissian v. Food Hunters, Inc., 193 N.J. Super. 603, 611-12 (App. Div. 1984).
In light of the motion judge's retirement, we do not remand the counterclaim for a corrective issuance of a statement of reasons. Instead, we vacate the orders dated March 24 and March 31, 2009, and remand the case for a plenary rehearing of plaintiff's motion for dismissal with prejudice and defendant's opposing motion for reconsideration. As part of that rehearing on remand, the trial court should consider whether alternative sanctions, short of a with-prejudice dismissal of the counterclaim, may accomplish the objectives of the Court Rules and the interests of justice.
For example, the court may consider, as a condition of restoration of the counterclaim, payment of the counsel fees for the time of opposing counsel on the first arbitration day and the possible imposition of additional counsel fees, if justified, for the time consumed on the second arbitration day.*fn9
We have not been furnished with an explanation of how counsel fees and costs for the first arbitration were totaled at $2,490.50. We agree that an award of some monetary sanction was within the court's discretion. R. 4:21A-4(f). However, we do not understand how the amount was tabulated. We also do not know why the fee award should fairly exceed, by analogy, the $750 fee cap prescribed by Rule 4:21A-6(c)(3) for circumstances where litigants reject an arbitration award and demand a trial de novo. On remand, the trial court should re-examine the monetary amount of the sanction, and its equitable consistency with the "reasonable fees" comparably allowable under Rule 4:21A-6(c)(3).
Should the trial court, in its sound discretion, choose to reinstate the counterclaim on specified conditions, the court may also re-examine defendant's assertion that additional discovery is warranted to enable a final disposition of that counterclaim on its merits. Pending the completion of that rehearing concerning the dismissal of the counterclaim and a reexamination of the reasonableness of the monetary sanctions imposed, execution on plaintiff's monetary judgment shall be stayed in the interim.
Affirmed in part, vacated in part, and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.