W. JAMES MAC NAUGHTON, Plaintiff-Appellant,
SHAI HARMELECH, CABLE AMERICA, INC., d/b/a SATELLITE AMERICA, and USA SATELLITE & CABLE, INC., Defendants-Respondents.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued October 8, 2013
On appeal from the Superior Court of New Jersey, Law Division, Sussex County, Docket No. L-442-12.
W. James Mac Naughton, appellant, argued the cause pro se.
William T. Harvey, Jr. argued the cause for respondents (Law Office of William T. Harvey, Jr., LLC, attorneys; Mr. Harvey, of counsel and on the brief).
Before Judges Fisher and O'Connor.
Following denial of a motion to amend his complaint in a pending federal action, plaintiff filed in the trial court a complaint, which alleges the same claim the federal court would not permit. The trial judge dismissed the state complaint, holding that plaintiff "selected his forum and cannot now be allowed to pursue a simultaneous action" in state court. We reverse.
Defendants moved to dismiss the complaint in this matter pursuant to Rule 4:6-2(e). In reviewing that dismissal, plaintiff is entitled to our assumption of the truth of his allegations and the benefit of all reasonable factual inferences. Independent Dairy Workers Union v. Milk Drivers Local 680, 23 N.J. 85, 89 (1956); Seidenberg v. Summit Bank, 348 N.J.Super. 243, 249-50 (App. Div. 2002). Accordingly, we assume the truth of the following.
Plaintiff, an attorney, represented defendants in litigation in the United States District Court for the Northern District of Illinois in 2009. Defendants fell behind on the payment of his fees and, as a result, on August 12, 2009, the parties executed a promissory note and security agreement that granted plaintiff "a security interest in all of [defendants'] right, title and interest in any and all real or personal property wherever located." The parties' agreement authorized plaintiff to sign defendants' name "to any UCC-1 or other documents reasonably necessary to perfect" plaintiff's security interest. Plaintiff alleges that defendants breached the terms of the promissory note and security agreement.
In October 2009, in an effort to collect his unpaid fees, plaintiff commenced a civil action in the United States District Court for the District of New Jersey. Plaintiff asserted in his federal complaint that subject matter jurisdiction was based on the parties' diversity of citizenship and that the amount in controversy exceeded $75, 000. 28 U.S.C.A. § 1332.
Defendants moved for dismissal, arguing the complaint failed to state a claim upon which relief might be granted. Fed.R.Civ.P. 12(b)(6). With respect to plaintiff's fourth count, which sought a declaratory judgment, District Judge Peter G. Sheridan held, in his written opinion of September 22, 2010, that the parties' August 12, 2009 agreement "did not create a security interest in [d]efendants' real property under either the Illinois Commercial Code or common law." Judge Sheridan explained that the description of the collateral was "supergeneric" and, for that and other reasons, he dismissed the fourth count.
Plaintiff further factually asserts in the matter at hand that, on June 20, 2011, he executed an amended security agreement that cures the "supergeneric" defect found by Judge Sheridan. He then moved to amend his federal complaint to add a count for enforcement of the amended security agreement. In an opinion filed on March 30, 2012, District Judge Esther Salas denied plaintiff's motion, concluding that plaintiff unduly delayed in asserting the claim. Judge Salas did not rule on the merits of this cause of action. In her opinion, Judge Salas recognized that plaintiff's claim was based on his assertion of the right to unilaterally amend the original security and concluded that she "need not, and does not, take a position on the validity of this legal theory."
Soon after his motion to amend the federal complaint was denied, plaintiff filed his complaint in this state action, seeking a declaratory judgment regarding the validity of the amended security agreement. Before filing an answer, defendants moved to dismiss the complaint pursuant to Rule 4:6-2(e). The motion judge determined, in his oral opinion, that plaintiff "elect[ed] [his] remedies" by filing a complaint regarding the same controversy in federal court and, to the extent his state complaint contained a viable claim, it could only be asserted in federal court. In a subsequent written ...