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Fontaine v. Berndtson

Superior Court of New Jersey, Appellate Division

July 23, 2013

DIANE FONTAINE, Plaintiff-Appellant,


Submitted April 16, 2013

On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-3337-09.

Burnham Law Group, LLC, attorneys for appellant (Philip S. Burnham, II, on the brief).

Margolis Edelstein, attorneys for respondents (Colleen M. Ready and Jessica R. Laine, on the brief).

Before Judges Lihotz and Mantineo.


In this auto negligence matter, we are asked to review whether defendants' facsimile notice to plaintiff Diane Fontaine, rejecting the arbitration award and requesting trial de novo on the thirtieth day following arbitration, and the filing of a demand for trial de novo filed the next day, was timely. Plaintiff appeals from a July 22, 2011 order denying her request to confirm an arbitration award, but granting defendants Bethany Berndtson and Catherine Berndtson's motion to reject the arbitration award and proceed to trial. The trial judge concluded defendants had "substantially complied" with the requirements of Rule 4:21A-6(b), which mandates notice of rejection must be filed within thirty days of the issuance of an arbitration award. Plaintiff argues the demand to the court was filed late and defendants failed to show extraordinary circumstances warranting consideration of the late filed notice. We agree and reverse.

In this auto collision matter, non-binding arbitration held pursuant to Rule 4:21A-1, resulted in a determination that defendants were 100% liable to plaintiff, who was entitled to $30, 000 in damages. We note, a second legal action filed by Ann Dragon, who was the driver of the vehicle struck by defendants in which plaintiff was a passenger, was consolidated with this matter prior to arbitration.[1]

On June 27, 2011, thirty days following entry of the arbitration award, defendants' attorney transmitted by facsimile a notice rejecting the arbitration award and demanding trial de novo. Immediately prior to sending the fax, at approximately 4:45 p.m., defense counsel called counsel for Dragon to inform him of the decision to reject the arbitration determination and proceed to trial. Dragon's counsel worked on the same floor as plaintiff's counsel and agreed to deliver the message. It was too late to file the demand for trial with the court, but defendants arranged for its delivery the following morning. Defendants' demand for trial was declined by the court clerk as untimely.

Defendants moved to allow their demand for trial de novo to be filed as within time. Counsel filed a supporting certification explaining a diary error by his staff caused the belated filing with the court, and maintained plaintiff received notice prior to the expiration of the designated thirty-day period. Defendants argued the doctrine of substantial compliance applied and the demand should be accepted as timely. A second certification from counsel's secretary explained the firm had two matters listed for which a request for trial de novo was to be filed. She mistakenly believed both notices had been sent, but later learned no notice was sent for this matter.

Plaintiff opposed defendants' motion, arguing substantial compliance was inapplicable to relax the thirty-day de novo filing deadline; rather, defendants were compelled to show extraordinary circumstances for the late submission. Asserting counsel's negligence did not meet the extraordinary circumstances standard, plaintiff requested the court deny defendants' motion and grant her cross-motion to confirm the arbitration award.

The judge granted defendants' motion, concluding defendants demonstrated substantial compliance. She also denied plaintiff's cross-motion to confirm the arbitration award. Plaintiff's request to stay the order pending her request for interlocutory appellate review was denied in part; however, the judge stayed trial for sixty days. This court denied plaintiff's motion seeking leave to appeal.

Following trial, the jury rendered a defense verdict, finding no cause of action was presented. This appeal ensued.

Rule 4:21A-6(b) sets forth post-arbitration obligations of a party dissatisfied with an arbitration award, succinctly stating:

An order shall be entered dismissing the action following the filing of the arbitrator's award unless: (1) within 30 days after filing of the arbitration award, a party thereto files with the civil division manager and serves on all other parties a notice of rejection of the award and demand for a trial de novo[.]

Incredible as it may be, innumerable motions have been spawned by attorney inadvertence and the failure to comply with these direct and simple requirements. Consequently, this court and the New Jersey Supreme Court have been called upon to consider when the clear-cut thirty-day requirement should be relaxed.

In Hartsfield v. Fantini, 149 N.J. 611 (1997), and Wallace v. JFK Hartwyck at Oak Tree, Inc., 149 N.J. 605 (1997), both decided on the same day, the Court considered whether attorney lapses resulting in missing the thirty-day deadline nonetheless allowed a post-arbitration trial demand to be considered nunc pro tunc. In Hartsfield, supra, counsel missed the deadline by approximately thirty days, 149 N.J. at 614, and in Wallace, supra, by six days, 149 N.J. at 609. Citing our prior opinions on the issue, the Court affirmed application of the "extraordinary circumstance" standard and "the need for strict enforcement of the thirty-day rule." Hartsfield, supra, 149 N.J. at 617 (citing Mazakas v. Wray, 205 N.J.Super. 367, 370-71 (App. Div. 1985) (holding the thirty-day period may be extended by the courts when extraordinary circumstances exist, but that ordinarily the arbitration process should bring about an end to the litigation when neither party has made a timely motion for a trial de novo)).

The Court further cited approvingly our directive to trial courts to exercise the "'power to relax rules and grant equitable relief . . . sparingly . . . with a view to implementing both the letter and the spirit of the compulsory arbitration statute and the rules promulgated pursuant thereto, to the end that the arbitration proceedings achieve finality.'" Ibid. (quoting Mazakas, supra, 205 N.J.Super. at 372). Finally, the Court instructed: "What constitutes an 'extraordinary circumstance' will require a fact-sensitive analysis in each case." Id. at 618. Nevertheless, an extraordinary circumstance will not "arise from an attorney's 'mere carelessness' or 'lack of proper diligence.'" Ibid. (quoting In re T., 95 N.J.Super. 228, 235 (App. Div. 1967)). See also Wallace, supra, 149 N.J. at 610 (rejecting attorney carelessness as grounds for relaxation of thirty-day rule).

In this matter, the trial judge relied on Gerzsenyi v. Richardson, 211 N.J.Super. 213, 217 (App. Div. 1986), suggesting "the exceptional circumstances standard could be applied to allow the late filing of a demand for trial de novo where the demand was filed before the 30-day period expired but was not received by the [c]ourt until after the 30[-]day period expired." The judge also determined defendants took steps to cure and had "generally complied with the purpose of the statute and court rule, " and there was no prejudice to plaintiff.

The facts in Gerzsenyi, supra, which are apt to our discussion, include that counsel mailed the demand to the court nearing the end of the thirty-day period, apparently relying on the three-day delivery period found in Rule 1:3-3. However, the pleadings were not received or filed until one business day (and three actual days) beyond the thirty-day filing period. 211 N.J.Super. at 217. The Appellate panel noted the trial court did not have the benefit of Mazakas, which was decided after the appeal was pending. Ibid. The Appellate panel concluded the counsel's conduct demonstrated "[s]ubstantial compliance with the filing limitation . . . evident from the facts in this case and this constitutes one of the 'extraordinary circumstances' referred to in Mazakas[, supra, ] 205 N.J.Super. at 371-[]72[]."

However, guidance has since been provided by the Supreme Court in Hartsfield, supra, and Wallace, supra, and these holdings make clear, when examining whether to grant a motion for filing a demand for trial de novo with the court, nunc pro tunc, the movant must show extraordinary circumstances. Further, the Court stressed counsel's "mere carelessness" and "lack of proper diligence" is insufficient to meet this standard. Hartsfield, supra, 149 N.J. at 618 (internal quotation marks and citations omitted).

The facts examined by the Court in Hartsfield, supra, included counsel's explanation regarding "the departure of two attorneys from his four-attorney office[, ]" leaving behind 1000 cases, along with his "failure to review his diary and to ensure that his secretary followed his instructions[.]" 149 N.J. at 616-20. Also, in Wallace, supra, counsel's carelessness was not found sufficient when he placed a filing reminder on the wrong date in his calendar so the notice was filed six days late. 149 N.J. at 610. See also Martinelli v. Farm-Rite, Inc., 345 N.J.Super. 306, 312-13 (App. Div. 2001) (holding that an attorney's computer malfunction was not an extraordinary circumstance warranting relief), certif. denied, 171 N.J. 338 (2002); Flagg v. Twp. of Hazlet, 321 N.J.Super. 256, 260 (App. Div. 1999) (holding counsel's failure to timely mail a demand for trial de novo was "nothing more than a claim of human error or carelessness" and not extraordinary); Behm v. Ferreira, 286 N.J.Super. 566, 574 (App. Div. 1996) (determining counsel's failure to supervise staff was insufficient ground to relax deadline for filing a trial de novo demand); Hart v. Prop. Mgmt. Sys., 280 N.J.Super. 145, 147-49 (App. Div.) (holding extraordinary circumstances not found to exist where attorney present at the arbitration hearing left without filing a notice of rejection of the award and demand for trial de novo), certif. Denied, 141 N.J. 99 (1995).[2]

We see little difference between a notice filed one day late or six days late. Reliance on the proximity of counsel's reaction to the deadline such that the deadline was almost met misses the point entirely. The thirty-day deadline is designed to buttress the integrity of the arbitration process and the enforceability of arbitration awards. It also triggers issuance of a prompt trial date for those matters needing judicial adjudication. The thirty-day period is not a mere technicality, which can be sidestepped by offering a reasonable explanation of why it was missed. To permit relaxation merely because counsel awakened to the fact that the deadline had arrived or had just passed renders the thirty-day period meaningless and significantly thwarts the design of smooth administration of the arbitration-litigation process. This is precisely why the Court required "strict enforcement" of the thirty-day deadline and set the standard for relaxation at "extraordinary circumstances[, ]" not simply excusable neglect. Hartsfield, supra, 149 N.J. at 617; Wallace, supra, 149 N.J. at 610. Courts retain the authority to relax the thirty-day statutory filing deadline in those rare instances where there is sufficient showing of extraordinary circumstances warranting relaxation. Lack of diligence is not one of those instances and we are not free to disregard this standard. On this issue, we conclude Gerzsenyi's contrary holding is mistaken. The Court has made clear that counsel's inattention or inadvertence does not qualify as extraordinary circumstances. Hartsfield, supra, 149 N.J. at 618; Wallace, supra, 149 N.J. at 610.

Specifically examining the facts in this matter, we disagree with the position finding counsel's explained lapse met the extraordinary circumstances standard allowing relaxation of the time to file a demand seeking a trial de novo. The facts offer mere office confusion to justify the delay. Hartsfield and Wallace hold something more than being too busy, overworked, distracted, or mistaken must be shown. Therefore, the July 22, 2011 order as to plaintiff is reversed.

To some the result may seem harsh. However, defendants knew they had thirty days to decide whether to reject the arbitration award. The thirty-day period allows time for diligent consideration, review, and filing of a demand for trial de novo. The time period is not so short that immediate action must be taken, or so long as to result in unnecessary delay in moving toward a final resolution. Management of the thirty-day time frame seems easily met. Mere negligence in the failure to do so is not a justifiable excuse.

As to plaintiff, the no cause judgment dismissing her complaint is vacated. The order denying plaintiff's motion to confirm the arbitration award and granting defendant's motion for a trial de novo is reversed. The matter is remanded to the Law Division for entry of an order confirming the arbitration award for plaintiff.

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