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Cedar Knolls Estates, L.L.C. v. Analan, Inc.

Superior Court of New Jersey, Appellate Division

July 23, 2013

CEDAR KNOLLS ESTATES, L.L.C., a New Jersey Limited Liability Company, and STANLEY T. OLMAND, an individual, Plaintiffs,
ANALAN, INC., a New Jersey Corporation, and ALLAN FIORE, an individual, Defendants-Appellants, and ONE TWELVE CORPORATION, a New Jersey Corporation, Defendant-Respondent, and A. FIORE SERVICES, INC., a New Jersey Corporation, ANDREW FIORE, an individual, C & H ENVIRONMENTAL, INC., a New Jersey Limited Liability Company, and MARY R. ESPOSITO, an individual, Defendants, and ANALAN, INC., a New Jersey Corporation, ALLAN FIORE, A. FIORE SERVICES, INC., and ANDREW FIORE, Third-Party Plaintiffs,


Argued May 13, 2013

On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-2790-05.

Edward J. Gilhooly argued the cause for appellants.

Craig S. Provorny argued the cause for respondent One Twelve Corporation (Herold Law, P.A., attorneys; Mr. Provorny, on the brief).

Before Judges Graves and Guadagno.


Analan, Inc. and Allan Fiore, appeal from a judgment ordering them to pay attorneys' fees and costs incurred by respondent One Twelve Corporation. When the parties were last before us on the same issue, we remanded the matter to the trial court "to determine the amount of attorneys' fees and costs that One Twelve is entitled to receive." Cedar Knolls Estates, LLC v. Analan, Inc., No. A-5754-09 (App. Div. Dec. 16, 2011) (slip op. at 10).

We repeat the essential facts from our prior opinion:

In 1996, One Twelve sued Fiore, an adjacent property owner, alleging that Fiore had contaminated property owned by One Twelve. That lawsuit was resolved in 1999 when Analan (a corporation owned by Fiore and his brother) agreed to purchase One Twelve's property for $125, 000; Analan and Fiore agreed to be solely responsible for the cost of remediating the contamination; and Analan and Fiore further agreed to "defend, indemnify and hold harmless [One Twelve] from and against all obligations, liabilities, damages, costs, fines, penalties, losses and expenses, including reasonable attorney fees and expert witness fees, under, in connection with, arising from or relating to Environmental Liabilities."
In 2001, Analan sold the property to Cedar Knolls, and in 2005, Cedar Knolls filed the present action against Analan, Fiore, and One Twelve to recover the costs incurred by Cedar Knolls to remediate the contaminated property. On November 22, 2005, Herold and Haines, P.A., filed an answer and counterclaim on behalf of One Twelve together with a cross-claim against Analan and Fiore alleging they were obligated to defend and indemnify One Twelve, and to hold it harmless for any and all environmental liabilities. Pursuant to a consent order dated March 9, 2006, Analan and Fiore "agreed to defend, indemnify and hold harmless One Twelve in the Litigation." Consequently, One Twelve's cross-claim was dismissed subject to reinstatement in the event that Analan or Fiore failed to comply with the terms of the consent order.
Counsel for Analan and Fiore represented One Twelve for more than two years (from February 2006 until August 2008) before claiming a conflict of interest. On August 20, 2008, Edward Gilhooly filed a substitution of attorney stating that he would represent only Analan and Fiore, and Herold and Haines resumed the defense of One Twelve. In April 2009, Herold Law, P.A., substituted in for Herold and Haines.
One Twelve and Cedar Knolls eventually agreed to release their claims against each other. One Twelve sought reimbursement for its legal fees and costs from Analan and Fiore. Thereafter, on August 12, 2009, One Twelve filed a motion to enforce litigant's rights. Included with One Twelve's motion was a copy of a "Client Ledger Report" from Herold Law showing that it had been paid the sum of $79, 563.79 for the legal services it rendered on behalf of One Twelve.

[Cedar Knolls, supra, slip op. at 3-4.]

On remand, the parties submitted certifications in support of their determination of fees. Respondent sought a total of $165, 689.97, in addition to the cost of the litigation on remand.

After oral argument, the court awarded respondent a total of $132, 014.84. The court made findings based on certifications without a plenary hearing, relying on the factors cited in Rendine v. Pantzer, 141 N.J. 292, 335 (1995), with regard to the reasonableness and amount of fees requested. The court found the fees requested to be "quite reasonable" and found nothing "out of line in the amount of work done and the type of work done." In addition, the court found the results of the litigation to be "excellent."

Appellants filed a motion for reconsideration which was denied on September 14, 2012, after oral argument. This appeal followed.

Appellants first argue the trial court's decision to award $26, 000 in attorneys' fees incurred in connection with the prior appeal was improper, because respondent did not apply first to the Appellate Division for fees.

Rule 2:11-4 provides:

An application for a fee for legal services rendered on appeal shall be made by motion supported by affidavits as prescribed by R. 4:42-9(b) and (c), which shall be served and filed within 10 days after the determination of the appeal. The application shall state how much has been previously paid to or received by the attorney for legal services both in the trial and appellate courts or otherwise, including any amount received by way of pendente lite allowances, and what arrangements, if any, have been made for the payment of a fee in the future. Fees may be allowed by the appellate court in its discretion:
(a) In all actions in which an award of counsel fee is permitted by R. 4:42-9(a), except appeals arising out of mortgage or tax certificate foreclosures.
(b) In a worker's compensation proceeding. Where the determination of the Supreme Court reverses a denial of compensation in the Appellate Division, the Supreme Court shall determine the fees for services rendered in both appellate courts.
(c) As a sanction for violation by the opposing party of the rules for prosecution of appeals.
In its disposition of a motion or on an order of remand for further trial proceedings, where the award of counsel fees abides the event, the appellate court may refer the issue of attorney's fees for appellate services to the trial court for disposition.

Our remand provided the following direction:

In view of the foregoing, the final judgment entered on June 18, 2010, is reversed and the matter is remanded to the trial court for such further proceedings as the court deems necessary and appropriate to determine the amount of attorneys' fees and costs that [respondent] is entitled to receive. We do not retain jurisdiction.

[Cedar Knolls, supra, slip op. at 10.]

We reject appellants' argument that Rule 2:11-4 requires a separate application before us for attorney fees rendered on appeal. We also find that our remand is sufficient to authorize the trial court to determine all fees and costs that respondent is entitled to receive, including fees incurred as a result of the appeal.

Appellants next argue that "collection fees and costs" should not have been granted because respondent's failure to send bills to appellants constituted a "material breach" of the agreement, therefore the motion was not truly enforcing litigants' rights. We find that this argument does not warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). We note only that the consent order explicitly required Fiore to guarantee "all reasonable fees or expenses" respondent incurred in enforcing all of Analan's obligations. The trial court did not abuse its discretion in requiring collection fees to be paid.

Appellants next argue respondents are "at most entitled to recover under an implied contract" due to a material breach of the contract which required respondent to "send the bills" to Fiore. The consent order requires appellants to "defend, indemnify and hold harmless [respondent] in the Litigation" in accordance with the Guaranty. The Guaranty is not breached because the billings were not submitted to Fiore.

Appellants argue a plenary hearing is required to review the "unconscionable" billing. Pursuant to Rule 4:42-9(b), an award of counsel fees requires an affidavit of service but not a plenary hearing. Elizabeth Bd. of Educ. v. N.J. Trans. Corp., 342 N.J.Super. 262, 271-72 (App. Div. 2001). A hearing is not required if the evidence before the court "is sufficiently complete to enable it to reach a fair determination as to the extent of the legal services rendered." Cohen v. Fair Lawn Dairies, Inc., 44 N.J. 450, 452 (1965). A plenary hearing is required "only when the certifications of counsel raise material factual disputes that can be resolved solely by the taking of testimony. . . . [S]uch hearings will be a rare, not a routine, occurrence." Furst v. Einstein Moomjy, Inc., 182 N.J. 1, 24 (2004).

Here, the trial court was presented with extensive records of billing and found the information adequate to determine counsel fees without a plenary hearing. We find the decision to deny a plenary hearing was not an abuse of discretion.

Finally, appellants argue that "[w]here those responsibilities are not defined in the agreement, only areas of fault by the indemnitor (Analan/Fiore) are covered by the indemnity defense claus[e]." Therefore, the award should be limited to a portion of the fee proportional to appellants' contamination of the property.

It is clear that appellants are required to "defend, indemnify and hold harmless [respondent] from and against all obligations, liabilities, damages, costs, fines, penalties, losses and expenses, including reasonable attorney fees and expert witness fees, under, in connections [sic] with, arising from or relating to Environmental Liabilities occurring at any time before, on or after the [c]losing." Contrary to appellants' argument they are required to "indemnify [respondent] for legal costs incurred by it as owner defending its own fault" Accordingly appellants' argument seeking apportionment of fees is without merit R 2:11-3(e)(1)(E)


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