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Smiley v. Thomas

Superior Court of New Jersey, Law Division, Atlantic County

February 13, 2017

DAREN SMILEY, Plaintiff,
v.
TONYA M. THOMAS, ENTERPRISE LEASING COMPANY OF PHILADELPHIA, LLC d/b/a ENTERPRISE RENT-A-CAR, JOHN DOE; MARY DOE; ABC CORPORATIONS; XYZ PARTNERSHIPS; multiple, fictitious persons and entities; j/s/a, Defendants.

         NOT FOR PUBICATION WITHOUT THE APPROVAL OF THE COMMITTEE ON OPINIONS

          Decided: October 11, 2 016

          Alan M. Lands, for plaintiff.

          Brooke A. Bonett, for defendant.

          COMMITTEE ON OPINIONS

          SAVIO, J.S.C.

         This opinion deals with the interpretation of the child support lien statute, N.J.S.A. 2A:17-56.23b. The lien, created by operation of N.J.S.A. 2A:56.23b, has " [p]riority over all other levies . . . against the net proceeds of any settlement negotiated . . . subsequent to filing of a lawsuit . . . unless otherwise provided by the Superior Court . . . ."

         The statute requires a child support judgment search to determine if a plaintiff is obliged to pay a child support obligation before the "net proceeds" of a settlement of a civil suit can be distributed to plaintiff. N.J.S.A. 2A:56-23b. If plaintiff has an outstanding child support obligation, the statute mandates the payment of that obligation out of the net proceeds of the settlement of the civil litigation. N.J.S.A. 2A:17-56.23b(b)(2). The net proceeds of the settlement are defined in N.J.S.A. 2A:17-56.23b(a) as "[a]ny amount of money, in excess of $2, 000, payable to the prevailing party . . . [in civil litigation] . . . after attorney's fees, witnesses fees, court costs, . . . and other costs related to the lawsuit . . . are deducted from the . . . award . . . ."

         The matter before the court is a relatively routine personal injury automobile accident action filed as a result of a motor vehicle accident that occurred on June 4, 2014, in Atlantic City. Defendant, Tonya M. Thomas, was the operator of a vehicle owned by defendant, Enterprise Leasing Company of Philadelphia, LLC d/b/a Enterprise Rent-A-Car, that was proceeding west on Baltic Avenue through its intersection with Rosemont Place. Plaintiff, Daren Smiley, alleges that defendant operated the vehicle negligently and that her negligence proximately caused the accident and his alleged injuries. Plaintiff seeks damages for the pain, suffering, disability, and impairment he claims to have experienced as a proximate result of defendant's negligence.

         Presumably, prior to the filing of the civil suit, in accordance with Rule 1:21-7(c), plaintiff and plaintiff's counsel entered into a standard contingent fee agreement. Rule 1:21-7(c) provides in pertinent part:

(c) In any matter where a client's claim for damages is based upon the alleged tortious conduct of another . . . an attorney shall not contract for, charge, or collect a contingent fee in excess of the following limits:
(1) 33⅓% on the first $750, 000 recovered

         Plaintiff is the father of three children. On April 5, 2004, a child support order was entered by the Superior Court, Chancery Division, Family Part requiring plaintiff to pay child support in the amount of $25 a week for the benefit of one of his children. On July 8, 2010, a second child support order was entered by the same court requiring plaintiff to pay child support in the amount of $89 a week for the benefit of the two remaining children. At the time of the filing of the application, plaintiff owed $19, 306.04 in unpaid child support. The plaintiff's child support obligation has been docketed with the Clerk of the Superior Court. N.J.S.A. 2A:17-56.23b(a).

         In interpreting N.J.S.A. 2A:17-56.23b, the Appellate Division opined that only the amount left of the plaintiff's settlement after litigation costs that exceeds $2000 is subject to the lien created by N.J.S.A. 2A:17-56.23(b). Simpkins v. Saiani, 356 N.J.Super. 26, 28 (App. Div. 2002). Furthermore, if the net proceeds are less than the amount of the child support judgment, then the entire amount of the "net proceeds" sans $2000 shall be paid to the Probation Division as "partial" satisfaction of the judgment. Id. at 30.

         Plaintiff's counsel brings this application seeking an order to judicially sanction the retroactive modification of the contingent fee agreement with plaintiff. The judicially sanctioned retroactive modification of the fee agreement would allow plaintiff's counsel to reduce his fee and to authorize plaintiff's counsel to distribute the difference between the fee plaintiff's counsel is entitled to receive in accordance with the written fee agreement and the judicially approved reduced fee to plaintiff as an incentive for plaintiff to accept the settlement proposal. In addition, plaintiff's counsel seeks an order of ...


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