On appeal from Superior Court of New Jersey, Law Division, Morris County, Docket No. L-1213-07.
The opinion of the court was delivered by: Fuentes, P.J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
APPELLATE DIVISION May 6, 2013
Argued January 11, 2012 -
Before Judges Fuentes, Graves, and Harris.
The opinion of the court was delivered by FUENTES, P.J.A.D.
In this legal malpractice case, the Law Division granted defendant attorney Amato Galasso's summary judgment motion, dismissing plaintiffs Jennifer and Richard Winstock's (wife and husband) complaint as a matter of law.
We frame the issues raised by plaintiffs in this appeal in the form of the following questions: (1) can Richard Winstock, a former Roxbury police officer, sue defendant for incorrect legal advice that Winstock claims resulted in his conviction, by way of a plea agreement with the State, for third degree promotion of gambling in violation of N.J.S.A. 2C:37-2a(2); and (2) can Jennifer Winstock, the legal owner and registered agent for the limited liability corporation that operated and promoted the gambling enterprise, sue defendant based on the same theory of liability, despite the State consenting to her admission into the Pretrial Intervention Program (PTI), N.J.S.A. 2C:43-12, as part of a global plea agreement involving all those indicted for these offenses, including her husband?
Relying on Alampi v Russo, 345 N.J. Super. 360, 367 (App. Div. 2001), the trial judge granted defendant's summary judgment motion, holding that plaintiffs' "thesis for recovery undermine[d] the public policy expressed by the doctrine of judicial estoppel." The motion judge also dismissed plaintiffs' claim for emotional distress damages raised as part of this legal malpractice action, because plaintiffs had not presented expert testimony to support this form of relief. Gautam v. De Luca, 215 N.J. Super. 388, 399 (App. Div.), certif. denied, 109 N.J. 39 (1987).
Plaintiffs now argue on appeal that the trial judge erred in relying on Alampi to dismiss their complaint. Plaintiffs argue that, unlike the facts in Alampi, in which the plaintiff retained the defendant attorney after the plaintiff had already engaged in criminal conduct, plaintiffs here retained defendant to ensure that their business model was proper and lawful. Thus, according to plaintiffs, but for defendant's incorrect legal advice, they would not have engaged in the conduct that gave rise to the criminal charges. Plaintiffs also argue that the trial court should not have dismissed their claim for emotional distress damages pursuant to Gautam because, under these circumstances, an expert is not necessary.
Because the trial court dismissed plaintiffs' causes of action as a matter of law, our standard of review requires us to consider all factual allegations in the light most favorable to plaintiffs. The "essence of the inquiry" is "'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 536 (1995) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52, 106 S. Ct. 2505, 2512, 91 L. Ed. 2d 202, 214 (1986)); see also R. 4:46-2(c). In the process of making this determination, "'we are not required to accept, as competent evidence, a purely self-serving certification by [a] plaintiff that directly contradicts his [or her] prior representations in an effort to create an issue of fact, which his [or her] previous testimony had eliminated.'" Alfano v. Schaud, 429 N.J. Super. 469, 475 (2013) (quoting Shelcusky v. Garjulio, 343 N.J. Super. 504, 510 (App. Div. 2001), rev'd on other grounds, 172 N.J. 185 (2002)).
After carefully reviewing the record before us, and mindful of our standard of review, we reverse the order dismissing plaintiffs' legal malpractice action. The material factual issues disputed in this case preclude a strict application of the principles we endorsed in Alampi. Unlike in Alampi, a rational jury in this case could find that defendant's role as a legal advisor was a substantial factor that led plaintiffs to engage in criminal conduct. The trial court also misapplied Alampi by treating Richard Winstock's guilty plea as creating an impenetrable wall, shielding defendant from civil liability based on professional malpractice. In cases involving tort or contract claims, the doctrine of issue preclusion does not automatically prevent a plaintiff in a civil trial from contesting the admitted facts that formed the basis of his or her guilty plea. State, Dep't of Law and Pub. Safety v. Gonzalez, 142 N.J. 618, 629 (1995) (citing Eaton v. Eaton, 119 N.J. 628, 643 (1990)).
As to Jennifer Winstock, her case against defendant is unencumbered by the concerns associated with her husband's criminal conviction. Admission into PTI is not predicated upon an accused acknowledging his or her culpability to a particular corresponding criminal charge. Guideline IV, R. 3:28. Furthermore, once admitted into supervisory treatment, as was the case here with Jennifer Winstock, any "statement or disclosure" made by a participant in a PTI program is not admissible evidence against her "in any civil or criminal proceeding." N.J.S.A. 2C:43-13f (emphasis added).
We affirm, however, the motion judge's dismissal of plaintiffs' claim for emotional distress damages. We discern no legal basis to deviate from our holding in Gautam prohibiting the recovery of such damages in legal malpractice cases.
Richard Winstock began working as a police officer for the Township of Roxbury in 1993. He was promoted to the supervisory rank of Sergeant in 2001. In the fall of 2003, Roxbury Police Chief Mark Noll learned that Sergeant Winstock and fellow Roxbury police officer Thomas Juskus were "running poker tournaments at a firehouse at Port Morris," a section of the Township of Roxbury. Chief Noll testified before the grand jury that indicted plaintiffs*fn1 that he "ordered" both officers "not to be involved with anything to do with organizing poker tournaments." Around the same time this was taking place, Lieutenant James Simonetti informed Chief Noll that Sergeant Winstock and Officer Juskus were involved in another poker tournament taking place in a building occupied by the Knights of Columbus in the Borough of Netcong. Chief Noll ordered Winstock and Juskus to also avoid any contacts with this gambling activity.
At his deposition in connection with his legal malpractice action, Richard Winstock testified that the "poker tournaments" at the firehouse and the Knights of Columbus were restricted at first to his friends and acquaintances. However, the tournaments quickly grew to involve "at [their] height" as many as one hundred players. The tournaments were held at the Knights of Columbus in Netcong when the number of players grew to this level; the firehouse in Roxbury was not large enough to accommodate this many people.
As Richard Winstock explained at his deposition, the tournaments were arranged to award the top ten "participants" a percentage "of the total money put in at the start of the tournament." Thus, assuming a particular tournament had one hundred players, the top ten "would get something . . . [a]nd the other 90 percent would get nothing." At first, the tournaments were organized by Richard Winstock, Juskus, and a friend of Winstock named Tom Valienti. The three of them "collectively" provided the cards and chips for the poker games and awarded the top ten winners shirts and hats in addition to their winnings.
According to Richard Winstock, the first time he met defendant was at a poker tournament that defendant "was running" in a VFW "east of Roxbury." He went to the tournament only to play cards and did not discuss his idea of starting his own club with defendant at that time. He raised the issue of a club with defendant months after the tournament, when he called defendant "[t]o ask his legal advice on the legality of the operation."
According to Mr. Winstock, he told defendant on the phone that he, Juskus, and Valienti "were looking to open up an establishment where [they] would go and [they] wanted to charge an hourly rate to be in the establishment and if it would be okay if [they] played cards in the establishment." When defense counsel asked Winstock whether he described to defendant "the other recreation activities that [he] intended to be there at the time," Winstock answered: "No."
Mr. Winstock testified that, based on his training and experience as a police officer, he had some understanding about the legality of gambling activities codified in Title 2C before he called defendant to solicit his advice. Winstock summarized his understanding of this area of the law as follows:
In the law enforcement community they call it a golden rule, it is basically, the house cannot make any money. They cannot take what's called a [d]ig and they cannot rake,*fn2 which you referred to earlier.
My understanding was that whatever was put into the game must go out, must be awarded in the game and in the State of New Jersey they term it as you're considered a player of the game so it is legal in the State of New Jersey.
So my interpretation of the statutes are, ten of us play cards at our house, we all put in $100, as one person walks away and any combination of those guys walk away with $1,000 that would be legal under New Jersey statute.
So my understanding, at that time, you know, with my training was that as long as the house wasn't taking profit from the gambling, we were not in violation. That's exactly why I contacted Amato to verify that. [(Emphasis added).]
Despite this definitive statement concerning the scope of defendant's role at this juncture of his deposition, a few pages later, Mr. Winstock testified that defendant's role went far beyond just providing legal advice:
A. Mr. Galasso was to oversee the opening of the Fifth Street Club and to make sure it stayed within the boundaries and the guidelines of the statutes. That was his role, to be involved in facilitating its operation.
Q. When you say "operation," you mean the actual operation of the club, he was going to oversee that?
Q. And you paid him to do that?
A. He was given a retainer to monitor how the club operated.
Q. How much was this retainer?
A. I don't know the specific amount.
Q. When you're talking about monitoring, are you talking about legal work as a lawyer or are you talking about other work other than legal work in terms of the day-to-day operations of the club?
A. Specifically, Amato said that every piece of paper, every tournament, every bit of the operation would go through him. He wanted to monitor how he was being paid to monitor the operation. I guess from a legal point of view. Does that answer your question?
Q. He was never considered an employee of the LLC, was he?
A. Are you asking me my interpretation? We had no employees, but, yes, Fifth Street Club hired him to be its attorney.
Q. You retained him but he wasn't on any payroll for Fifth Street Club, was he?
Q. Okay. What's the basis of that?
A. Part of the retainer was that he would be in the club at any time free of charge so in my opinion, he's receiving a monetary fee for being our counsel. [(Emphasis added).]
By letter dated July 1, 2004, Sergeant Winstock wrote to Chief Noll seeking leave to work part-time to help his wife who was "starting a business" to be known as "Fifth Street Club LLC"*fn3
located in a "warehouse" in the Town of Dover. In support of his formal request for "off-duty employment approval," Sergeant Winstock described the work he intended to do for his wife as follows:
An abundance of construction work will be required to successfully make the location habitable. The request contained within will be to perform all construction work, to include: carpentry, plumbing, electrical, sheetrock, painting, heating/air conditioning, and/or all work necessary to pass Township [sic]*fn4 of Dover inspections.
Once the business is open, I will also be maintaining the premise to include all janitorial work and maintenance of the establishment and equipment on site.
Fifth Street Club LLC (Private Social Club) will be a [sic] 8000 sq/ft facility that will offer a variety of adult recreational activities, To [sic] include pool tables, dart boards, air hockey tables, T.V. lounge area, kitchen area, ping pong table area, backgammon tables, chess tables, cigar lounge area, card table area, and fuse [sic] ball tables.
Sergeant Winstock indicated in the form used by the Roxbury Police Department that his "off-duty employment" would be ...