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Johnson Specialized Transportation, Inc v. Donald Metzger; Route 295 Burlington Land Trust; Bernie Enterprises

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


August 24, 2011

JOHNSON SPECIALIZED TRANSPORTATION, INC., PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
v.
DONALD METZGER; ROUTE 295 BURLINGTON LAND TRUST; BERNIE ENTERPRISES, INC.;*FN1 AND EDWARD H. GEORGE, INDIVIDUALLY, JOINTLY AND SEVERALLY, DEFENDANTS-RESPONDENTS/CROSS-APPELLANTS.

On appeal from the Superior Court of New Jersey, Chancery Division, Burlington County, Docket No. C-49-05.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued March 2, 2011

Before Judges Sapp-Peterson and Simonelli.

Plaintiff leases property owned by defendants. Plaintiff appeals from the trial court order denying its motion to enforce a settlement agreement. Defendants cross-appeal that portion of the trial court's March 25, 2010 order preventing plaintiff's eviction from the premises until defendants reimburse plaintiff for its cleanup costs. Plaintiff's response to the cross-appeal was untimely filed and no motion for leave to file out of time was ever filed. We now dismiss this appeal because it is an appeal from an interlocutory order and leave to appeal was never sought.

A recitation of the procedural background of this case is illustrative of why dismissal, rather than granting leave nunc pro tunc for interlocutory relief, is appropriate. In 2002, plaintiff entered into an agreement to lease defendants' property. In 2005, defendants initiated eviction proceedings in the Special Civil Part. The matter was transferred to the Chancery Division where, on June 28, 2005, the parties appeared before the court and reported they had reached a settlement. Plaintiff's counsel placed the terms of the settlement on the record. Those terms included: (1) dismissal of the eviction proceedings; (2) release of approximately $49,000 being held in escrow to defendants; (3) purchase of the property by plaintiff for $750,000, of which $100,000 would be set aside for plaintiff's cleanup of the property; (4) requiring defendants to obtain "a letter of no further applicability in connection with [Industrial Site Recovery Act (ISRA), N.J.S.A. 13:1K-6 to -14] issues"; and (5) closing on the sale of the property to occur within approximately 120 days. Additionally, plaintiff's counsel placed on the record that the settlement called for the cleanup and necessary certifications [to] be obtained within the 120-day period.

In the event that it needs to run over, the seller has agreed to allow the buyer to continue to rent at the increased rental of $6826.73[,] which is what the mortgage would be if there had been a closing, but the party's intent is to close within the 120 days or at the 120-day.

Further, the settlement required that plaintiff's attorney draft a contract of sale. Finally, plaintiff's counsel advised the court that "this is a complete settlement between the parties on all of the issues so that the case can be dismissed subject only to performance of these items that we've agreed to." The court accepted plaintiff's counsel's representations and advised that the matter would be "dismissed, but in the event that there's non-performance[,] it can be reinstituted." Plaintiff's counsel indicated that the parties wanted to submit a stipulation to the court but stated: "I know that you'll probably dismiss it from the docket today subject to a more specific stipulation[.]"

The court entered an order dismissing the matter through settlement the next day. The Stipulation of Dismissal was apparently not forthcoming, leading defense counsel to forward correspondence to plaintiff's attorney on August 17, 2005, directing "that all clean-up work is to cease and desist on this date, and there is to be no further work performed on the property until such time as the Stipulation of Settlement is submitted to us for our consent."

The parties, by consent, filed an "ORDER FOR DISMISSAL WITH STIPULATIONS" on August 7, 2007. The order contained all of the provisions that had been placed on the record by plaintiff's counsel on June 28, 2005, including the language of the court that "this case is dismissed subject to performance, but in the event of non-performance can be reinstituted[.]" The body of the order is dated August 7, 2005, but the filing date on the order is stamped "August 7, 2007."

In January 2009, plaintiff filed a motion to enforce the settlement and to compel defendants to sell the property. Defendants filed a cross-motion to terminate plaintiff's lease. The court conducted oral argument on the motion, during which plaintiff's counsel contended plaintiff had undertaken the remediation of the property in accordance with the agreement, was entitled to certain credits, and was also entitled to enforcement of the settlement agreement the parties had entered in August 2007.

Defense counsel argued that the purchase option was limited in time and that contrary to plaintiff's counsel's representation, the actual date of the order stipulating the dismissal of the action, with conditions, was August 7, 2005. Although the court advised counsel that it would reserve decision and issue a written decision, it did not do so. Rather, it entered an order, dated May 20, 2007, granting plaintiff's motion:

1. The Order of Judge Ronald E. Bookbinder dated August 7, 2007 is hereby enforced; and

2. Defendants shall immediately take steps to produce the ISRA letter of non-applicability as required by paragraph 4 of the Order for Dismissal dated August 7, 2007;

3. Defendants shall immediately execute the contract of sale as required by paragraph 5 of the Order for Dismissal dated August 7, 2007; and

4. Closing shall be scheduled by the parties in accordance with the contract.

Notwithstanding that defense counsel appeared and argued in opposition to plaintiff's motion and in support of defendants' motion, the order marked the motion as unopposed. According to defendants, the court vacated this order on December 3, 2009. That order, however, is not part of the record on appeal.

On January 19, 2010, plaintiff filed a second motion to enforce litigant's rights, once again seeking an order enforcing the August 7, 2007 order that required defendants to: (1) produce the ISRA letter of non-applicability; and (2) execute the contract of sale in accordance with paragraph 5 of the August 7 order. Plaintiff also sought an award of counsel fees in connection with the application.

The court denied the motion and issued a written opinion on March 24, 2010, in which it found that neither party had been vigilant in pursuing their claims. Nonetheless, the court acknowledged plaintiff's claim that it had expended $300,000 for the cleanup of the property, well in excess of the $100,000 set aside for remediation in the settlement. The court also noted the invoices plaintiff submitted for review to support this contention. The court reasoned that

[I]t would be inequitable to allow plaintiff to have expended significant sums to clean up the property under a court order, and then be ordered to return the enhanced property to the defendant[s,] who allowed the [cleanup] to proceed and then decided after nearly five years [they] did not want to sell.

. . . For the property to be returned to the defendants in a cleaned up state, after such a significant sum was expended by the plaintiff[,] would be tantamount to forfeiture. Equity abhors forfeiture.

The court ordered that plaintiff should not be removed from the premises until reimbursed for the expenses it incurred during the cleanup and that if the parties could not reach an agreement on the amount, then the parties "shall attend mediation before further court intervention." The court denied defendants' cross-motion to terminate the leasehold until after there "has been an accommodation for the reimbursement to the plaintiff for the [cleanup] expenses." The present appeal followed.

On appeal, plaintiff raises the following points for our consideration:

POINT I

THE COURT ERRED IN DENYING APPELLANT'S MOTION TO ENFORCE THE SETTLEMENT AGREEMENT. POINT II

THE COURT ERRED IN DENYING APPELLANT'S COUNSEL FEES AS A RESULT OF MR. LITMAN'S UNAUTHORIZED PRACTICE OF LAW.

POINT III

THIS MATTER SHOULD BE REMANDED TO [THE] LAW DIVISION FOR DAMAGES AS RELATED TO THE UNAUTHORIZED PRACTICE OF LAW BY MR. LITMAN.

The court's order dismissing the complaint dated June 29, 2005, states that the dismissal of the complaint was "without prejudice." The subsequent order memorialized the fact that the dismissal was without prejudice. Whether the governing order is the August 5, 2005 order or the August 7, 2007 order, both orders paraphrase the court's oral decision of June 28, 2005 that the complaint "will be dismissed, but in the event that there's non-performance it can be reinstituted." Thus, the orders of June 29, 2005, August 7, 2005, and August 5, 2007, were not final orders disposing of all issues between the parties. See Grow Co., Inc. v. Chokshi, 403 N.J. Super. 443, 461 (App. Div. 2008) (holding that order dismissing, without prejudice, former employee's counterclaim for counsel fees based upon former employer's alleged breach of settlement agreement was interlocutory order, not final, appealable order). The Stipulation of Dismissal without prejudice imposed conditions upon the parties, which, if not satisfied, left the parties free to reinstitute their claims for resolution on the merits.

Although we have previously granted leave to appeal nunc pro tunc and addressed the merits of improperly filed interlocutory appeals, we have recently emphasized that our court rules are written to "require uniformity as a means of providing equal justice. The time has come to enforce the Rules and not to decide an appeal merely because the respondent did not move to dismiss it and it was fully briefed." Vitanza v. James, 397 N.J. Super. 516, 519 (App. Div. 2008).

We make one final observation. In denying relief to both parties, the court directed the parties to mediate the reimbursement of the cleanup claims before returning to the court for further actions. We interpret this action by the court as further evidence of the interlocutory nature of the proceedings before the court.

As our recitation of the procedural history of this case reveals, the proceedings surrounding this litigation were protracted and confusing. While we believe the Chancery judge reached an appropriate equitable resolution on the merits of the parties' claims, the prior order made clear that non-performance of any of the conditions of the terms of the settlement embodied in the court's order rendered the matter subject to reinstitution, not an action to enforce the settlement. Upon remand, the parties are free to move to reinstitute the prior actions and to advance in those actions the claims and defenses they deem meritorious.

Dismissed.


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