March 2, 2012
LIAM KILCOMMONS, BY HIS GUARDIAN AD LITEM, SEAN KILCOMMONS; SEAN KILCOMMONS, INDIVIDUALLY; AND JODI KILCOMMONS, PLAINTIFFS-RESPONDENTS,
EILEEN W. CAPPIELLO, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-5302-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued February 14, 2012
Before Judges A. A. Rodriguez and Sabatino.
This appeal arises out of the delayed delivery of a defendant's demand for a trial de novo following an arbitration award. Defendant's trial counsel*fn1 provided correspondence containing the demand to a courier service two days before the thirty-day filing deadline prescribed by N.J.S.A. 39:6A-31 and Rule 4:21A-6(b)(1), with instructions to deliver it to the court the next day. For reasons that are unclear from the record, the courier service did not deliver the demand to the courthouse until three days later, which was one day after the thirty-day period lapsed. The demand was timely served, however, upon plaintiffs' counsel. Given these particular circumstances, the trial court erred in rejecting defendant's request to extend the filing deadline by one day, and we accordingly reverse and remand for a trial de novo in the Law Division.
The relevant chronology is uncomplicated and substantially undisputed. Plaintiffs, Liam Kilcommons, Sean Kilcommons, and Jodi Kilcommons, sued defendant Eileen W. Cappiello in the Law Division for personal injuries arising from an automobile accident. On December 7, 2010, the parties appeared in the courthouse for mandatory, non-binding arbitration pursuant to N.J.S.A. 39:6A-24 to -35 and Rule 4:21A-1 to -9.
The arbitrator determined that defendant was exclusively at fault for causing the accident and awarded $150,000 in damages to plaintiffs.
Pursuant to N.J.S.A. 39:6A-31 and Rule 4:21A-6(b)(1), defendant had thirty days, i.e. until January 6, 2011,*fn2 to file and serve a demand for a trial de novo. Defendant's trial counsel accordingly prepared such a demand.
On January 4, 2011, the office of defendant's trial counsel gave correspondence containing the de novo demand and the required $200 fee to a well-established and reputable courier service. The correspondence was addressed to the trial court's arbitration administrator, with instructions to the courier service to deliver the correspondence to the courthouse as a "standard service" item. According to the courier service's materials, when a customer checks the "standard service" box for a delivery, it "means that the package will be delivered to the recipient's address by the end of the next day." Meanwhile, defendant's trial counsel also transmitted the de novo demand to plaintiffs' counsel, who received it on January 4, 2011, two days before the thirty-day deadline.*fn3
Unfortunately, the courier service did not deliver the package containing the de novo demand to the courthouse until January 7, 2011, one day after the deadline. The record does not enlighten us as to why it took the courier service three days to make this particular delivery.*fn4 However, it is undisputed that defendant's trial counsel had no reason to believe that the courier service would not deliver the package, as instructed, on the next day. It is also undisputed that defendant's trial counsel did not make any follow-up inquiries of the courier service on or before January 6 to confirm that the package would be delivered to the courthouse on time. Instead, defendant's trial counsel did not learn of the lateness of the delivery until after the fact.
The arbitration administrator's office rejected the de novo demand because it had arrived one day late. Consequently, the office sent a form letter to defendant's trial counsel noting the rejection and advising counsel to "file a motion for leave to file the Trial De Novo [Demand] out of time." Pursuant to that advice, defendant's trial counsel promptly moved for leave to file a late notice, contending that he had substantially complied with the thirty-day deadline and that the unanticipated failure of the courier service to deliver the demand within two days was an extraordinary circumstance that justified relaxation of the period by one day. Plaintiffs' counsel did not oppose defendant's motion for relaxation of time, but instead cross-moved to confirm the arbitration award.
After considering the matter on papers, the trial court denied defendant's motion for leave to file a late de novo demand and granted plaintiffs' cross-motion to confirm the arbitration award. The court issued two companion orders on February 4, 2011 reflecting these dispositions. The order denying defendant's motion included a handwritten notation by the motion judge, stating that "[a] slow delivery service does not constitute 'exceptional circumstances,'" and citing Hartsfield v. Fantini, 149 N.J. 611 (1997).
Defendant then moved for reconsideration, which the trial court also denied following oral argument. In its bench ruling on the reconsideration motion, the trial court concluded that defendant had neither shown extraordinary circumstances to justify the late delivery nor demonstrated substantial compliance with the thirty-day filing deadline. The court likened the present situation to the one in Hartsfield, in which the Supreme Court underscored the stringent nature of the thirty-day deadline and declined to excuse a late filing arising out of a secretarial error and a breakdown in the attorney's case management system. Id. at 614.
The trial court particularly faulted defendant's counsel for having waited until "so close to the eleventh hour" to transmit the demand and for not following up with the courier service to verify that the delivery would indeed be made on time. The court further expressed reluctance to relaxing the rule in these circumstances and, in effect, adopting "a judicial[ly]-created exception" that might discourage attorneys from being more diligent in assuring compliance with the thirty-day deadline in the future.
Defendant now appeals, contending that, in these particular circumstances, the trial court misapplied its discretion in declining to relax the thirty-day period by one day. Plaintiffs, meanwhile, urge that we affirm the trial court's orders, although they acknowledge that they were served on time and have suffered no prejudice as a result of the one-day filing delay.
The applicable statute and court rule bespeak a strong policy insisting on timeliness in the filing of a de novo demand. The arbitration program is designed to be an expeditious process for resolving certain categories of pending civil actions. That policy is undermined if program deadlines are not, in general, stringently observed and enforced. In particular, with respect to the thirty-day deadline for a party dissatisfied with the arbitration award to file a demand for a trial de novo, "'[t]he Legislature intended [that rule] . . . to be strictly enforced.'" Hartsfield, supra, 149 N.J. at 616 (quoting Hart v. Prop. Mgmt. Sys., 280 N.J. Super. 145, 147 (App. Div.), certif. denied, 141 N.J. 99 (1995)).
That said, our courts retain the authority, in the interest of justice, to relax the thirty-day deadline -- albeit sparingly -- in limited circumstances where there is sufficient justification to do so. In particular, the filing deadline may be relaxed in situations where the movant has shown "extraordinary circumstances" that equitably warrant such relaxation. See, e.g., Hartsfield, supra, 149 N.J. at 616-20 (adopting such an "extraordinary circumstances" test, but finding that the test was not satisfied by "the departure of two attorneys from [the movant's] four-attorney office" and his "failure to review his diary and to ensure that his secretary followed his instructions"); Wallace v. JFK Hartwyck at Oak Tree, Inc. 149 N.J. 605, 610 (1997) (holding that an attorney's mailing of a de novo demand six days out of time was not excused by extraordinary circumstances where the attorney had carelessly placed a filing reminder in his calendar on the wrong date); Martinelli v. Farm Rite, Inc., 345 N.J. Super. 306, 312-13 (App. Div. 2001), certif. denied, 171 N.J. 338 (2002) (holding that an attorney's computer malfunction was not an extraordinary circumstance warranting relief).
In Corcoran v. St. Peter's Med. Ctr., 339 N.J. Super. 337, 342-43 (App. Div. 2001), we observed that the equitable doctrine of "substantial compliance" applies to an assessment of whether the thirty-day filing requirement should be relaxed. See also Gerzsenyi v. Richardson, 211 N.J. Super. 213, 217 (App. Div. 1986). Under that doctrine, a party seeking relief from the requirements of a statute or court rule must show (1) a lack of prejudice to the opposing party; (2) a series of steps taken to attempt to comply with the requirements; (3) general compliance with the overall purposes of the requirements; (4) reasonable notice of the party's claim; and (5) a reasonable explanation of why there was not strict compliance with the provision. See Corcoran, supra, 339 N.J. Super. at 343 (citing Alan J. Cornblatt, P.A. v. Barow, 153 N.J. 218, 239 (1998)).
In applying these principles, the judicial determination of whether a matter represents a rare instance warranting the relaxation of the thirty-day deadline is "fact sensitive and should be made on a case-by-case basis." Flagg v. Twp. of Hazlet, 321 N.J. Super. 256, 258 (App. Div. 1999). We are mindful of the discretion and sound judgment that trial judges must exercise daily in making these fact-sensitive determinations, particularly if they involve an assessment of the credibility of the parties' respective contentions about why a deadline was missed. See Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 483-84 (1974).
The published opinion with a fact pattern most closely resembling the present scenario is Stegmeier v. St. Elizabeth Hosp., 239 N.J. Super. 475 (App. Div. 1990). In that case, defendant's counsel filed a motion for a new trial on the tenth and last day allowed by the applicable court rule. Id. at 478. On that same day, defendant's counsel gave a copy of the motion papers to an independent delivery service for service upon the plaintiff's attorney. Id. at 479. However, for unknown reasons, the courier did not deliver the papers to the plaintiff's attorney until the fourteenth day, four days late. Id. at 479, 481. We concluded that, in those particular circumstances, defendant's counsel had substantially complied with the prescribed time limits. Id. at 483. We further held that the requirements for service may be deemed satisfied when the motion papers are given to a "reputable independent messenger service for delivery within the time limitation of the rule" and "when there has been timely filing, despite a short delay in effecting service, provided the movant acted in good faith and there is no prejudice to the opposing party." Ibid.
Plaintiffs correctly point out that Stegmeier involved the question of late service made upon an opposing attorney, rather than late filing of a document with the court. See id. at 480 n.3 (noting the distinction between filing and service). We recognize that the thirty-day deadline for filing a de novo demand is a statutory requirement under N.J.S.A. 39:6A-31, as opposed to the service deadline at issue in Stegmeier based upon a Court Rule. We further recognize that our courts have applied a less-stringent "good cause" standard, rather than an "extraordinary circumstances" standard, to excuse the late service of a de novo demand pursuant to Rule 4:21A-6 in instances where the demand was timely filed with the court. See, e.g., Flett Assocs. v. S.D. Catalano, Inc., 361 N.J. Super. 127, 133 (App. Div. 2003); see also Pressler & Verniero, Current N.J. Court Rules, comment 7.2.1 on R. 4:21A-6 (2012). Even so, we conclude that the principles of Stegmeier, when logically and fairly applied to the particular setting of this case, compels the conclusion that defendant's request for a one-day relaxation rises not only to the level of "good cause" but also comprises "extraordinary circumstances."
We reach this determination for several reasons. First, the length of the delay here is modest -- one day -- and is far shorter than the delays noted in many of the published cases where exceptional circumstances were deemed absent. See, e.g., Hartsfield, supra, 149 N.J. at 614 (wherein the movant filed a demand for a trial de novo twenty days late); Wallace, supra, 149 N.J. at 609 (six days late); Hart, supra, 280 N.J. Super. at 146-47, 149 (over 100 days late).
Second, defendant's trial counsel did not wait until the "eleventh hour" to transmit the de novo demand, but had allotted two full days for the courier service to deliver the document to the courthouse.*fn5 In that vein, we note that it is not uncommon for counsel to consume much of the thirty-day period conferring with their clients and adversaries, determining whether a de novo demand will be authorized, and also possibly attempting to settle the case.
Third, defendant's trial counsel, like the movant's counsel in Stegmeier, had no reason to believe that a reputable courier service would fail to deliver the package within a two-day period. The late delivery appears to have been an unexpected aberration. Although we agree with the trial court that attorney diligence is to be encouraged, we are not convinced that defendant's trial counsel had a legal obligation to follow up with the courier service in these particular circumstances.*fn6
This is not a situation of poor office management or inadequate supervision by an attorney.
Further, there is no prejudice here to plaintiffs or their attorney, as they admittedly received the de novo demand on time and, in fact, did not file opposition to the relaxation motion but only cross-moved to confirm the arbitration award in the event such relaxation was denied. Cf. Wallace, supra, 149 N.J. at 609; Martinelli, supra, 345 N.J. Super. at 309.
For similar reasons, we conclude that "substantial compliance" with the statute and rule was achieved. Among other things, we reject plaintiffs' contention that defendant's trial counsel failed to perform a "series of steps" necessary to attain substantial compliance with the statute and rule. Instead, defendant's trial counsel placed the demand with an established delivery service two full days before the filing deadline, e-mailed a timely copy of the demand to opposing counsel, and made a prompt motion for relief once the problem was called to the law firm's attention.
We understand, and indeed endorse, the trial court's well-articulated concerns about the importance of timely filing and service by lawyers and clients who participate in the arbitration program. Our opinion is limited to the facts before us. It should not be misread as a departure from the strong policies enunciated by the Legislature and the Supreme Court demanding timely filings in the arbitration program. We simply hold that, based on the unique scenario before us, the trial court's orders denying relaxation of the thirty-day period must be equitably overturned. In addition, the order confirming the arbitration award must likewise be vacated.