NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1628-13T1

MYRNA B. TAGAYUN and

ROBERT S. MANDELL,

Plaintiffs-Appellants,

v.

AMERICHOICE OF NEW JERSEY, INC.,

a New Jersey corporation, d/b/a 

United Healthcare Community Plan;

MICHELE NIELSEN, individually

and as an officer of AmeriChoice

of New Jersey, Inc., d/b/a United 

Healthcare Community Plan; STRADLEY

RONON STEVENS & YOUNG, LLP, a 

Pennsylvania Limited Liability

Partnership; FRANCIS X. MANNING, 

ESQUIRE, an attorney at law, licensed 

in the State of New Jersey, 

individually and as an officer and/or

employee of Stradley Ronon Stevens &

Young, LLP; MARISSA PARKER, ESQUIRE,

an attorney at law, licensed in the

State of New Jersey, individually and

as an officer or employee of Stradley

Ronon Stevens & Young, LLP; L. JOHN

VASSALOTTI 3, JR., an attorney at law,

licensed in the State of New Jersey, 

individually and as an officer and/or

employee of Stradley Ronon Stevens & 

Young, LLP,

Defendants-Respondents.

_______________________________________

Submitted September 17, 2015 – Decided June 28, 2016

APPROVED FOR PUBLICATION

SEPTEMBER 20, 2016

APPELLATE DIVISION
2 A-1628-13T1

Before Judges Lihotz, Fasciale and Higbee.

On appeal from Superior Court of New Jersey, 

Law Division, Essex County, Docket No. L5348-12.

Myrna B. Tagayun and Robert S. Mandell, 

appellants pro se.

Stradley Ronon Stevens & Young, LLP, 

attorneys for respondents (Francis X. 

Manning, on the brief).

The opinion of the court was delivered by

HIGBEE, J.A.D.

Plaintiffs, Dr. Myrna B. Tagayun, and Robert S. Mandell,

her husband and office manager, appeal (1) a May 1, 2013 order 

awarding defendant, AmeriChoice, counsel fees as a sanction for 

pursuing a frivolous claim in their original complaint pursuant 

to Rule 1:4-8; (2) a May 9, 2013 order dismissing plaintiffs'

amended complaint and declaring it was also a frivolous pleading 

pursuant to N.J.S.A. 2A:15-59.1; and (3) an October 22, 2013 

order granting defendant's motion for additional fees and 

amending the May 1, 2016 money judgment against plaintiffs to 

include legal fees incurred in responding to the amended 

complaint. Plaintiffs state in their brief they are limiting 

their appeal only to whether sanctions and fees should have been 

awarded against them.
3 A-1628-13T1

For the reasons that follow, we affirm in part and reverse 

in part and remand for amendment of the amount of the judgments 

against plaintiffs.

We first set forth the germane facts and procedural 

history. Plaintiffs filed a complaint against defendants, 

AmeriChoice of New Jersey Inc., Michele Nielsen, an officer of 

AmeriChoice, and various other associated entities they allege 

did business as AmeriChoice, as well as other fictitiously named 

defendants. The dispute concerned a contract entered into by 

Tagayun and AmeriChoice whereby Tagayun, a neurologist, became a 

participating provider for AmeriChoice HMO members.

AmeriChoice sent Tagayun notice she would be terminated as 

a provider. Plaintiffs filed their pro se complaint against 

defendants and requested an order to show cause for injunctive 

relief to prevent Tagayun's termination. Defendants' counsel

sent a letter rescinding the notice to terminate, thus 

plaintiffs were temporarily successful in preventing the 

termination. Defendants and plaintiffs appeared before the 

court where Mandell argued that defendants would just terminate 

Tagayun again in a few months. Nonetheless, the judge found 

there was no longer a need for injunctive relief. Additionally, 

defendants had not filed an answer to the original complaint in 

a timely fashion and were ordered to file an answer. Although 
4 A-1628-13T1

they were ordered to do so, defendants never filed an answer to 

the original complaint. Nor did they file an answer to the 

amended complaint. 

AmeriChoice did subsequently terminate the services of 

Tagayun by not renewing her contract and filed a motion to 

dismiss the original complaint and transfer the matter to 

arbitration.

Defendants notified Tagayun that her complaint was 

frivolous, pursuant to Rule 1:4-8(b)(1), because the contract 

required arbitration of all disputes between the parties.

Defendants, at the same time, also notified Mandell his claim 

was frivolous as he was not a party to the contract and 

therefore, had no standing to enforce the contract.

When plaintiffs refused to dismiss their claims, defendants 

filed a motion to dismiss. Defendants were ultimately 

successful and then filed a motion for sanctions under Rule 1:4-

8(b)(1).

After oral argument, the judge entered the January 11,

2013 order dismissing the original complaint without prejudice 

as to Tagayun and sending her claims to arbitration. The judge 

also dismissed Mandell's claims with prejudice for lack of 

standing. Plaintiffs filed an amended complaint on January 14, 

2013, which was substantively the same as the original 
5 A-1628-13T1

complaint, except the law firm and individual attorneys for 

defendants were added as additional named defendants.

On January 15, 2013, plaintiffs appealed from the January

11, 2013 order dismissing their original complaint. The appeal 

proceeded despite the filing of the amended complaint. While 

that appeal was ongoing, the Law Division judge continued to 

consider and rule on motions filed by defendants related to the 

original complaint being frivolous and on similar motions 

related to the amended complaint. We issued an opinion on 

August 30, 2013, affirming the January 11, 2013 order sending 

Tagayun's claims to arbitration.1 That final Appellate order may

not be challenged in this subsequent appeal.

In the interim, defendants moved to have both complaints 

declared frivolous and sought an award of attorney fees as a 

sanction against plaintiffs. Oral argument was scheduled for 

February, but was adjourned at plaintiffs' request. Plaintiffs 

claim no hearing was ever held on the motions. However, because

plaintiffs filed no opposition to the two motions requesting 

sanctions, no oral argument was required. In an order dated May 

1, 2013, the judge concluded the original complaint was 

frivolous and entered an order granting a fee award of 

 

1 Mandell's appeal was dismissed as interlocutory. 
6 A-1628-13T1

$10,073.20 in favor of defendants against plaintiffs jointly,

severally, and in the alternative.2 

On May 9, 2013, the judge dismissed the amended complaint, 

found it was frivolous, and ordered defendants to submit an 

application for fees related to the amended complaint. The 

judge made very limited findings simply writing on the May 1 and 

May 9 orders that each was granted for the reasons set forth in 

defendants' papers.

Plaintiffs filed an appeal from the May 1 and May 9, 2013 

orders. We granted defendants' motion to remand for entry of a 

final judgment with the addition of the fees assessed relating 

to the amended complaint and dismissed the appeal by plaintiffs

as interlocutory. 

Judge Stephen Taylor, who did not enter the prior orders,

was assigned to the case and heard oral argument solely on the 

issue of the amount of fees to be awarded related to the amended 

complaint. Defendants requested fees in the amount of $6,539.40 

and $60 in disbursements, totaling $6,599.40. Judge Taylor 

carefully reviewed each invoice on the record and required 

 

2 For the benefit of pro se plaintiffs we note that "jointly, 

severally in the alternative" means that the judgment can be 

collected from either Tagayun or Mandell or part of the judgment

can be collected from one of them and part from the other, 

however the total amount collected from both cannot exceed the 

amount awarded. Defendants cannot collect the amount of the 

judgment twice.
7 A-1628-13T1

defense counsel to explain the amounts billed.3 The judge 

ascertained the billing rate and hours for each attorney 

involved. The judge was advised none of the billing involved 

time devoted to defending the law firm, but only the amounts 

billed to the client relating to the amended complaint. The 

judge found both the attorneys' rates and the number of hours 

were reasonable. Tagayun argued plaintiffs' actions were not 

frivolous, but she did not address the amount of the fees.

Judge Taylor awarded the amount of fees requested. Although 

Mandell was not given an opportunity to speak at the hearing, he 

has presented no argument on appeal that suggests the amount of 

the legal fees imposed at the end of the hearing was improper. 

We review a trial court's imposition of frivolous 

litigation fees for an abuse of discretion. Masone v. Levine, 

382 N.J. Super. 181, 193 (App. Div. 2005). Reversal is 

warranted when "the discretionary act was not premised upon 

consideration of all relevant factors, was based upon 

consideration of irrelevant or inappropriate factors, or amounts 

to a clear error in judgment." Ibid.

 

3 Plaintiffs in their brief state they requested the transcript

for the hearing but had not received it. Defendants in their 

brief argued we should dismiss the appeal of the October 22, 

2013 order because no transcript was supplied. On November 12, 

2014 the transcript was provided to the Clerk of the Appellate 

Division and we review the appeal from that order on its merits. 
8 A-1628-13T1

To begin our analysis of the applicable law regarding 

frivolous litigation, we turn to relevant provisions of Rule

1:4-8(a):

By signing, filing or advocating a pleading,

. . . an attorney or pro se party certifies 

that to the best of his or her knowledge, 

information, and belief, formed after an 

inquiry reasonable under the circumstances:

(1) the paper is not being 

presented for any improper 

purpose, such as to harass or to 

cause unnecessary delay or 

needless increase in the cost of 

litigation;

(2) the claims, defenses, and 

other legal contentions therein 

are warranted by existing law or 

by a non-frivolous argument for 

the extension, modification, or 

reversal of existing law or the 

establishment of new law[.]

An award of fees against a party, as opposed to a lawyer or 

a self-represented litigant, engaging in frivolous litigation is 

governed by N.J.S.A. 2A:15-59.1(a)(1), which requires a judge to 

determine whether a pleading filed by a non-prevailing party was 

frivolous. In order to award fees under the statute, the court 

must find that a claim or defense was either pursued "in bad 

faith, solely for the purpose of harassment, delay or malicious 

injury" or that the non-prevailing party knew or should have 

known it "was without any reasonable basis in law or equity and 

could not be supported by a good faith argument for an 
9 A-1628-13T1

extension, modification or reversal of existing law." N.J.S.A.

2A:15-59.1(b)(1), (2).

There was no evidence presented that plaintiffs filed their 

original complaint simply to harass defendants. Defendants 

urged the court to find the original complaint was frivolous 

because Mandell lacked standing and Tagayun signed a contract 

that contained a provision that all disputes would go to 

arbitration. The judge found these were sufficient reasons to 

dismiss the original complaint. The dismissal based on the 

arbitration clause was affirmed on appeal. 

Plaintiffs argued before the trial court and on appeal that 

Tagayun had not waived her right to a jury trial because this 

explicit language or similar language was not in the contract's 

arbitration clause. 

When plaintiffs filed their complaint there were some

appellate decisions enforcing arbitration provisions that did 

not have explicit language waiving rights to access to the 

courts or juries decided prior to the decision in this case. 

See Griffin v. Burlington Volkswagen, Inc., 411 N.J. Super. 515, 

518 (App. Div. 2010); EPIX Holdings Corp. v. Marsh & McLennan 

Cos., 410 N.J. Super. 453, 476, overruled in part on other 

grounds by Hirsch v. Amper Fin. Servs., LLC, 215 N.J. 174, 192-

93 (2013). 
10 A-1628-13T1

However, the Supreme Court, in Atalese v. U.S. Legal 

Services Group, L.P., 219 N.J. 430 (2014), cert. denied, __ U.S.

__, 135 S. Ct. 2804, 192 L. Ed. 2d 847 (2015), while stressing 

that arbitration was favored by the law, explained that even 

under prior existing law relating to arbitration provisions in 

contracts, a knowing waiver of constitutional rights to a jury 

trial must be explicit in order to enforce the arbitration 

clause.

Therefore, we cannot support the trial court's conclusion 

that Tagayun's contention that she had not waived her right to 

litigate her contract claims in court was frivolous even though 

her claim was unsuccessful. Although Tagayun is bound by the 

decision of the Appellate Division affirming the dismissal of

her action, the fact she lost that battle does not mean her

contentions were frivolous. In light of the holding in Atalese,

her position cannot be described as frivolous under the 

controlling legal standards set forth above, which apply both to 

the rule and statute governing frivolous litigation.

As to Mandell, it is clear he was not a party to the 

contract. The trial court properly dismissed his claims for 

lack of standing. He was advised by letter from defendant's 

counsel that he was not a party to the contract and lacked 

standing. His refusal to accept this fact and to agree to be 
11 A-1628-13T1

dismissed as a party to the action, however, was not frivolous

under the controlling legal standards we set forth below which 

apply to both the rule and the statute governing frivolous 

litigation. The primary difference being that the rule governs 

awards against attorneys and self-represented litigants while 

the statute governs sanctions against parties.

The rule and statute must both be interpreted strictly 

against the applicant for an award of fees. See LoBiondo v. 

Schwartz, 199 N.J. 62, 99 (2009); DeBrango v. Summit Bancorp,

328 N.J. Super. 219, 226 (App. Div. 2000). This strict 

interpretation is grounded in "the principle that citizens 

should have ready access to . . . the judiciary." Belfer v. 

Merling, 322 N.J. Super. 124, 144 (App. Div.), certif. denied, 

162 N.J. 196 (1999). "The statute should not be allowed to be a 

counterbalance to the general rule that each litigant bears his 

or her own litigation costs, even when there is litigation of 

'marginal merit.'" Ibid. (citation omitted). Sanctions should 

be awarded only in exceptional cases. See Iannone v. McHale, 

245 N.J. Super. 17, 28 (App. Div. 1990). "When the plaintiff's 

conduct bespeaks an honest attempt to press a perceived, though 

ill-founded and perhaps misguided, claim, he or she should not 

be found to have acted in bad faith." Belfer, supra, 322 N.J. 

Super. at 144-45. The party seeking sanctions bears the burden 
12 A-1628-13T1

to prove bad faith. Ferolito v Park Hill Ass'n, 408 N.J. Super.

401, 408 (App. Div.), certif. denied, 200 N.J. 502 (2009).

Moreover, the grant of a dispositive motion, without more, does 

not suffice to establish a losing party's bad faith. Ibid.

Sanctions for frivolous litigation are not imposed because 

a party is wrong about the law and loses their case. The nature 

of conduct warranting sanction under Rule 1:4-8 and under the 

statute has been strictly construed. The term frivolous should 

not be employed broadly or it could limit access to the court 

system. First Atl. Fed. Credit Union v. Perez, 391 N.J. Super.

419, 432-33 (App. Div. 2007). Imposing sanctions is not 

appropriate where a party "has a reasonable good faith belief in 

the merit of his action." J.W. v. L.R., 325 N.J. Super. 543, 

548 (App. Div. 1999). In discussing the frivolous litigation 

statute, the Supreme Court, in McKeown-Brand v. Trump Castle 

Hotel & Casino, 132 N.J. 546, 561-62 (1993), explained the 

legislative history as follows:

The predecessor bill, A. 1086, allowed the 

prevailing party to recover fees from the 

non-prevailing party if that party's 

pleading was "not substantially justified." 

In the course of the legislative process, 

the term "frivolous" replaced "not 

substantially justified." Senate Judiciary 

Committee Statement to Assembly Committee 

Substitute for A. 1086, 2029, 783, and 1260

(Oct. 2, 1986). Indeed, the Governor's 

conditional veto message noted the "bill's 

restrictive definition of 'frivolous.'" The 
13 A-1628-13T1

replacement of "not substantially justified" 

with "frivolous" reflects the legislative 

intent to limit the application of the 

statute. That limitation is consistent with 

the premise that in a democratic society, 

citizens should have ready access to all 

branches of government, including the 

judiciary. See Iannone, supra, 245 N.J.

Super. at 27 (stating that limitation on 

award of counsel fees "promotes the goal of 

equal access to the court irrespective of 

economic status"). In brief, the 

Legislature resolved the tension between the 

competing goals of equal access to the 

courts and the avoidance of the costs of 

unnecessary litigation by favoring access 

over cost-avoidance.

 Since we conclude the trial judge's finding that the 

original complaint was frivolous is unsupported, we reverse and 

vacate the order of May 1, 2013. As to Mandell, we are also 

constrained to reverse the order of the trial judge that awarded 

sanctions against him in connection with the original complaint. 

He presented an argument to the court that he had standing as a 

third-party beneficiary of the contract. The judge properly 

declined to accept that argument, but an award of sanctions was

not warranted simply because Mandell misconstrued the law. 

However, we find the trial judge did not abuse her 

discretion in finding the filing of an amended complaint by both 

plaintiffs asserting the same claims that had just been 

dismissed by the court and adding defendants' counsel as parties 

was frivolous. Tagayun had been advised by the court their 
14 A-1628-13T1

claims had to be arbitrated. Plaintiffs had a right to appeal 

those decisions and in fact they availed themselves of that 

right the day after they filed their amended complaint. They 

had no right to force the defendants to defend an amended 

complaint asserting the same claims that had just been 

dismissed. At that point, Mandell had been told by the judge he 

had no standing to assert any claims under the contract and he 

was not a beneficiary of the contract. We therefore affirm the 

May 9, 2013 order finding the amended complaint was frivolous 

and imposing sanctions. 

We conclude Judge Taylor properly limited his role to 

determining the amount of fees that should be awarded. 

Plaintiffs' first appeal of the sanctions was dismissed as 

interlocutory and remanded for determining the total amount of 

the attorney fees. Plaintiffs' argument that Judge Taylor 

should have reconsidered the prior decision of the first judge 

lacks sufficient merit to address in a written opinion. R.

2:11-3(e)(1)(E).

As to the amount of fees awarded by Judge Taylor, we affirm 

for the reasons he expressed in his comprehensive oral decision 

from the bench on October 22, 2013. 

The judgment of $10,073.20 for frivolous filing of the 

original complaint is vacated as to both plaintiffs. We affirm
15 A-1628-13T1

the May 9, 2013 order ordering sanctions for frivolous filing of 

the amended complaint and affirm the October 30, 2013 order 

imposing sanctions in the amount of $6,599.40. We remand to the 

trial judge to reduce and amend the final judgment to $6,599.40 

against both plaintiffs jointly, severally, and in the 

alternative. 

Affirmed in part, reversed in part, and remanded for 

amendment of the amount of the judgment. We do not retain 

jurisdiction.