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V.K. v. New Jersey Manufacturers Ins. Co.

Superior Court of New Jersey, Appellate Division

August 26, 2013

V.K., M.K. and G.R., Infant Minors, by their Guardian Ad Litem, ROCCO PEZZELLA, as assignees of COREY J. CLIFFORD and COLIN J. CLIFFORD, Plaintiffs-Appellants,
v.
NEW JERSEY MANUFACTURERS INSURANCE COMPANY, Defendant-Respondent. JENNIFER ANN RODEN, as assignee of COREY J. CLIFFORD and COLIN J. CLIFFORD, Plaintiff-Appellant,
v.
NEW JERSEY MANUFACTURERS INSURANCE COMPANY, Defendant-Respondent.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued February 12, 2013

On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket Nos. L-1136-11 and L-4351-10.

Jacqueline DeCarlo argued the cause for appellants V.K., M.K. and G.R., infant minors in A-4682-11 (Hobbie, Corrigan & Bertucio, P.C., attorneys; Ms. DeCarlo, on the brief).

Randall Peach argued the cause for appellant Jennifer Ann Roden in A-4681-11 (Law Offices of Roy D. Curnow, attorneys; Mr. Curnow, of counsel and on the brief).

Richard J. Williams, Jr., argued the cause for respondent in A-4681-11 and A-4682-11 (McElroy, Deutsch, Mulvaney & Carpenter, LLP, attorneys; Mr. Williams and Michael J. Marone, of counsel; Mr. Williams, on the brief).

Before Judges Messano, Ostrer and Kennedy.

PER CURIAM

These back-to-back appeals, argued together and consolidated for purposes of this opinion, had their genesis in a motor vehicle accident that occurred on August 5, 2006. We set forth the underlying facts as contained in our earlier decision, Kearney v. Clifford, No. A-5147-08 (App. Div. Nov. 9, 2010):

[P]laintiff Jennifer Roden operated her automobile in Parkertown, with her then husband, Alvin Roden, seated in the front passenger seat, with the parties' son [G.R.], and Jennifer Roden's two daughters, [V.K.] and [M.K.], [1] seated in the rear passenger seat. While the Roden vehicle proceeded northbound on East Main Street, defendant Corey Clifford . . . proceeded in the opposite direction on the same street. Suddenly and without warning, the Clifford vehicle crossed the center dividing line on the roadway and struck the Roden vehicle head-on. The Roden vehicle was then struck from behind by a vehicle operated by defendant Casey Walsh. The Clifford vehicle was insured by New Jersey Manufacturers Insurance Company (NJM) with a combined $500, 000 single limit liability insurance policy.

Roden and her children (the minor plaintiffs) were severely injured and filed separate personal injury actions that were consolidated in the Law Division. Id. at 2.[2]

On November 7, 2007, one of plaintiffs' counsel sent a letter to defense counsel demanding that NJM deposit the insurance policy proceeds into court. NJM did not comply with the demands. On November 7, 2008, defense counsel sent plaintiffs' counsel a letter advising that he had obtained authority from NJM to offer $478, 122.81 in full settlement of all claims, said amount representing defendant's policy limits, less $21, 877.19 previously paid to Jennifer Roden on her automobile property damage claim. Plaintiffs[] rejected the offer to settle.
On November 13, 2008, defendant filed a motion seeking to deposit the balance of his insurance policy proceeds into court. The court granted the motion, and defendant deposited the insurance proceeds on January 14, 2009. On March 30, 2009, the matter proceeded to trial on the issue of damages only, defendant having stipulated to liability.
Id

Prior to verdict, Roden and the minor plaintiffs accepted an assignment of rights from Clifford to pursue "a bad faith claim" against NJM in return for releasing Clifford from any judgment exceeding his $500, 000 policy limits. The jury subsequently returned the following verdicts: M.K. -- $10 million; G.R. --$4 million; V.K. -- $2 million; and Roden -- $1.5 million. Id. at 14. We affirmed the judgments. Id. at 30.[3]

Within days of our decision, the minor plaintiffs, as assignees of Clifford and with their maternal grandfather, Rocco Pezzella, serving as their guardian ad litem, filed a complaint alleging bad faith against NJM. Roden filed a separate bad faith action against NJM a few months later. Discovery ensued, and while the record includes numerous examples of the contentious nature of the proceedings, these appeals are focused on one discrete issue, which arose in the following context.

Roden was deposed on December 30, 2011. As a result of what occurred during that deposition, NJM filed a motion seeking to compel Roden's continued deposition. On February 24, 2012, the parties appeared before the trial judge for argument, after which the judge entered his oral opinion on the record and the conforming order under review, which provides:

Roden shall appear . . . for the continuation of her deposition, at which time [she] shall answer questions concerning the following topics . . .:
1. her knowledge and understanding of the various settlement demands and offers exchanged between the parties in the underlying matters of Roden v. Clifford and M.K. et al v. Clifford ("the underlying matters");
2. Ms. Roden's motivation for and reasons for rejection of the defendant's settlement offer in the underlying actions; and
3. the circumstances, including date, time location, and a list of all attendees of any meetings attended by Ms. Roden involving the law firm of Hobbie[, ] Corrigan & Bertucio or any predecessor firm, as well as the nature and content of any communications at such meetings concerning settlement of the underlying matters or settlement offers from the defendants in the underlying matters.

The order further provided:

Roden may not refuse to answer any questions concerning any settlement demands, offers, or the rejection of any settlement demands or offers by her or any other party in the underlying matters on the ground that answering such questions requires disclosure of attorney-client communications. The attorney-client privilege shall not preclude any testimony by . . . Roden or any other party to this matter concerning settlement demands or offers or the rejection of any settlement demands or offers in the underlying matters[.]

We granted Roden's and the minor plaintiffs' motions for leave to appeal. The trial judge entered an order staying the proceedings pending appeal.

Before us, Roden and the minor plaintiffs essentially argue that the judge's order "improperly compels [them] to disclose privileged communications with their attorneys." NJM counters by arguing "information concerning the plaintiffs' knowledge, understanding of, and motivation behind the settlement demands and offers exchanged . . . is necessary and relevant and can only be obtained from plaintiffs."

Having considered these arguments in light of the record and applicable legal standards, we affirm in part, reverse in part, and remand for further proceedings consistent with this opinion. We also dismiss the appeal filed by the minor plaintiffs.

I.

Early in Roden's deposition, her attorney, Curnow, and counsel for the minor plaintiffs, DeCarlo, began lodging objections by asserting the attorney-client privilege. ...


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