Court Opinion

ID: 4428875
Source: CourtListenerOpinion
Date Created: 2019-08-20 19:14:13.526364+00
Date Added: 2024-06-11T14:50:50.234858
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
              APPROVAL OF THE APPELLATE DIVISION

                                   SUPERIOR COURT OF NEW JERSEY
                                   APPELLATE DIVISION
                                   DOCKET NO. A-3617-17T2

JOSIE SALAZAR and
BIJAY SHAH,

     Plaintiffs-Appellants,              APPROVED FOR PUBLICATION

                                                 April 8, 2019
v.
                                             APPELLATE DIVISION
MKGC + DESIGN, MILTON
KISLINGER and HELEN LEU,

     Defendants-Respondents.
____________________________

           Argued March 20, 2019 – Decided April 8, 2019

           Before Judges Nugent, Reisner, and Mawla.

           On appeal from Superior Court of New Jersey, Law
           Division, Hudson County, Docket No. L-3095-16.

           Jessica A. Tracy argued the cause for appellants
           (Curcio Mirzaian Sirot, LLC, attorneys; Jessica A.
           Tracy, of counsel and on the briefs).

           Robert F. Ball argued the cause for respondents (Weber
           Gallagher Simpson Stapleton Fires & Newby, LLP,
           attorneys; Robert F. Ball, of counsel and on the brief;
           Mark J. Heftler, on the brief).

     The opinion of the court was delivered by

NUGENT, J.A.D.
      Plaintiffs appeal several orders culminating in the involuntary dismissal

at trial of their action against defendants alleging breach of a home improvement

contract and consumer fraud. The trial judge granted defendants' motion for an

involuntary dismissal because plaintiffs could not prove damages. Plaintiffs

could not prove damages because another judge had granted defendants' pretrial

motion to bar plaintiffs' damage claims as a sanction for failing to respond to

defendants' notice to produce documents.

      The judge who granted defendants' pretrial motion for sanctions,

including their request to bar expert testimony, did so even though defendants

had filed the motion in violation of multiple court rules. Defendants filed the

motion belatedly, without demonstrating good cause to do so, and despite their

never having demanded an expert report from plaintiffs. They did not certify

they were not delinquent in their discovery obligations, which they were, as they

had not responded to plaintiffs' discovery.      They also disregarded the rule

requirements that are prerequisites to having a motion for discovery sanctions

listed for disposition.

      The grant of defendants' motion despite their multiple missteps resulted

in the functional equivalent of a dismissal of plaintiffs' complaint with prejudice

for a discovery violation; a sanction the Supreme Court has characterized as

                                                                           A-3617-17T2
                                        2
"drastic" and has cautioned against imposing if a lesser sanction will suffice.

Abtrax Pharm., Inc. v. Elkins-Sinn, Inc., 139 N.J. 499, 514 (1995). Perhaps

more significantly, the sanction could be viewed as the uneven-handed

administration of court rules, resulting in an unjust determination and the

needless expenditure and delay caused by a meaningless trial; all anathema to

the purpose for which the rules exist. See R.1:1-2. We thus reverse and remand

for further proceedings.

                                       I.

      This civil action arose out of a home improvement contract, which

plaintiffs alleged defendants failed to complete, leaving them with an

uninhabitable house. Plaintiffs filed a six-count complaint in August 2016, and

defendants filed an answer and counterclaim the following month. Defendants

served plaintiffs with requests for admission and a notice to produce documents ,

including documentary evidence of plaintiffs' damage claim. Defendants did

not serve interrogatories. Their demand for documents did not demand experts'

reports. Plaintiffs served defendant with interrogatories and a notice to produce

documents. None of the parties answered discovery.

      The discovery end date was July 25, 2017.         In October the parties

proceeded to mandatory arbitration as required by Rule 4:21A-1(a)(3). The

                                                                         A-3617-17T2
                                       3
arbitrator rendered an award for plaintiffs. Defendants rejected the award and

demanded a trial de novo, as permitted by Rule 4:21A-6(b)(1). Two weeks after

arbitration and three months after the discovery end date, defendants filed the

motion that resulted in the orders from which plaintiffs have appealed. Plaintiffs

filed a cross-motion seeking an order "Extending Discovery with Consent of All

Parties."

      Defendants entitled their motion for discovery sanctions "Motion for

Plaintiffs' Failure to Serve Discovery and to Bar Plaintiffs' Late Service of

Liability or Damage Experts Reports Pursuant to Rule 4:23-5(3)(b) [sic]." They

supported the motion with a certification from their attorney.            In his

certification, the attorney did not explain why he did not file the motion before

the discovery end date. He summarized the pleadings, explained plaintiffs had

not responded to defendants' requests for admission and notice to produce

documents, and omitted to disclose defendants had not responded to plaintiffs'

interrogatories and notice to produce documents.

      Plaintiffs informed the motion judge in their cross-motion that defendants

had not responded to plaintiffs' discovery demands. Nevertheless, the judge

granted defendants' motion and denied plaintiffs' cross-motion.        He barred

plaintiffs from presenting any evidence of damages not documented during

                                                                          A-3617-17T2
                                        4
discovery, knowing plaintiffs had produced no such documentary evidence, as

attested to by defendants in their motion. He gave this explanation, typed below

his signature on the order: "The [discovery end date] expired on July 25, 2017.

The documents sought to be introduced were only made available on the eve of

arbitration.   This results in substantial and undue prejudice to the

[d]efendant[s]."

      The motion judge denied plaintiffs' motion for reconsideration. In the

decision he delivered from the bench at the close of oral argument, the judge

noted that "discovery rules are designed to reach the substantive merits of a

matter rather than permitting reliance on procedural mechanisms that might

result in concealment and surprise." He did not, however, cite to any rule

concerning the timing of motions seeking sanctions for discovery violations, nor

did he cite to the requirements of any rule authorizing such sanctions. Citing

Abtrax, 139 N.J. at 521, for the proposition that the "underlying purpose [of the

discovery rules] is to assure full disclosure of all material facts and documents

to the parties, to the end the trial will serve the ends of justice rather than

function as a trap for the unwary," the judge neither noted nor discussed

defendants' violation of the same discovery rules and consequent undermining

of their purpose.

                                                                         A-3617-17T2
                                       5
      Accepting the representation of plaintiffs' counsel that his non-compliance

with discovery was not intended to obfuscate the issues in the case, the judge

explained:

             The fact still remains that the prejudice that will result
             in this case, both procedurally and also substantively,
             particularly since the discovery end date has passed, is
             not persuasive to the [c]ourt to allow for
             reconsideration of this case or this particular matter
             barring the late service of the liability and the damages
             expert report.

For that reason, the judge denied plaintiffs' motion for reconsideration.

      For reasons unnecessary to detail in this opinion, the trial proceeded,

notwithstanding the pretrial order barring plaintiffs from proving damages.

Plaintiffs developed the proofs they were permitted to present. Defendants

moved for an involuntary dismissal. The court granted the motion, based on the

absence of any damage proofs.           The court also dismissed defendants'

counterclaim. This appeal followed.

                                        II.

      On appeal, plaintiffs argue it was fundamentally unfair for the motion

judge to bar them from proving damages when defendants had committed the

identical discovery violations. Plaintiffs add that the motion judge compounded

his error by overlooking defendants' non-compliance with virtually every

                                                                            A-3617-17T2
                                         6
prerequisite for filing a motion for sanctions based on discovery violations. In

doing so, plaintiffs argue, the court imposed a draconian sanction unaut horized

by any court rule applicable to a discovery violation. Plaintiffs also contend the

motion judge erroneously denied their motion for reconsideration, and the trial

judge erred by involuntarily dismissing their action. Last, they contend the

motion judge erred by denying their motion to extend discovery.

      Defendants do not dispute that they did not comply with their discovery

obligations, nor do they dispute that they did not comply with the provisions of

certain rules concerning discovery sanctions. Rather, they argue a court has

inherent discretionary power to impose sanctions for failure to make discovery,

a power the motion judge did not abuse. They point out that plaintiffs did not

argue to the motion judge several points they now raise on appeal. Defendants

assert that because the motion judge did not abuse his inherent power to impose

sanctions for failure to make discovery, he properly denied plaintiffs' motion for

reconsideration, and the trial judge properly dismissed plaintiffs' action when

they failed to prove damages at trial.

                                                                          A-3617-17T2
                                         7
                                      III.

                                       A.

      We begin our analysis with some fundamental observations.           In our

judicial system, "justice is the polestar and our procedures must ever be moulded

and applied with that in mind." New Jersey Highway Auth. v. Renner, 18 N.J.

485, 495 (1955) (citing X-L Liquors v. Taylor, 17 N.J. 444, 454 (1955)). "There

is an absolute need to remember that the primary mission of the judiciary is to

see justice done in individual cases. Any other goal, no matter how lofty, is

secondary." Santos v. Estate of Santos, 217 N.J. Super. 411, 416 (App. Div.

1986).

      In that vein, the Court Rules "shall be construed to secure a just

determination, simplicity in procedure, fairness in administration and the

elimination of unjustifiable expense and delay." R. 1:1-2(a). For that reason,

"[u]nless otherwise stated, any rule may be relaxed or dispensed with by the

court in which the action is pending if adherence to it would result in an

injustice." Ibid.

      Fairness in administration of the Court Rules requires that they be applied

evenhandedly and, to the extent possible, uniformly. The current Court Rules

have been amended to achieve these, as well as other objectives:

                                                                         A-3617-17T2
                                       8
                The project known as Best Practices, resulting in a
                number of significant rule amendments effective
                September 2000, was undertaken by the Conference of
                Civil Presiding Judges for the purpose of attempting to
                improve the efficiency and expedition of the litigation
                process as well as to restore state-wide uniformity to
                the wide range of discretionary and increasing disparate
                judicial responses to such matters, among others, as the
                resolution of discovery problems and disputes, the
                fixing of trial calendars and adjournments of trial
                dates. . . .

                [Pressler & Verniero, Current N.J. Court Rules, cmt. 4
                on R. 1:1-2 (2019) (emphasis added).]

      With these principles in mind, and applying an abuse-of-discretion

standard of review, Quail v. Shop-Rite Supermarkets, Inc., 455 N.J. Super. 118,

133 (App. Div. 2018), we turn to the rules applicable to the motion at issue on

this appeal.1

                                          B.

      Rule 4:24-2 is entitled "Motions Required to Be Made During Discovery

Period." The rule provides in pertinent part: "Unless the court otherwise permits

for good cause shown, motions to compel discovery and to impose or enforce

sanctions for failure to provide discovery must be made returnable prior to the

expiration of the discovery period." R. 4:24-2(a). When defendants filed their

1
   This appeal does not involve sanctions imposed for violating a discovery
order. The trial court had issued no such order.
                                                                           A-3617-17T2
                                           9
motion for sanctions, they offered no explanation for their failure to file the

motion within the discovery period. That they had not done so was obvious

from their certification, in which they referred to the arbitration and the

arbitrator's award. For that reason alone, the motion judge would have acted

well within his discretion by denying the motion.          Carbis Sales, Inc. v.

Eisenberg, 397 N.J. Super. 64, 81 (App. Div. 2007).

      On the other hand, the rule expressly permits a judge to consider a

belatedly filed motion for good cause shown. Here, however, defendants did

not even attempt to make a showing of good cause, and the trial court did not

find defendants had made such a showing.

      Defendants had ample opportunity during the discovery period to compel

plaintiff to provide discovery responses.      Their failure to do so, without

explanation, suggests they did not have good cause to wait until after the

arbitration to file the motion. When the motion judge granted defendants'

motion for sanctions, he emphasized the undue prejudice to them. But the

possible prejudice was not "undue." Defendants' wholesale disregard of the

discovery rules refutes that proposition. Moreover, in weighing the prejudice to

the parties, we fail to discern how the possible prejudice to defendants — who

could still offer a defense, rely on their requests for admission, and offer proofs

                                                                           A-3617-17T2
                                       10
to support their counterclaim — was somehow greater in magnitude than the

prejudice to plaintiffs, who the motion judge effectively barred from proving

their case at trial.

       If a trial court declines to enforce a mandatory rule — particularly a rule

designed to provide uniformity and fairness in its application — the court should

explain its reasons for doing so. A brief explanation would demonstrate the

court is not acting in an arbitrary manner and would permit appropriate appellate

review.

                                         C.

       The Rules of General Application provide specific, mandatory

requirements for Civil and Family Part discovery and calendar motions. Rule

1:6-2 requires, with exceptions not applicable here, the following:

              Every motion in a civil case or a case . . . involving any
              aspect of pretrial discovery or the calendar, shall be
              listed for disposition only if accompanied by a
              certification stating that the attorney for the moving
              party has either (1) personally conferred orally or has
              made a specifically described good faith attempt to
              confer orally with the attorney for the opposing party in
              order to resolve the issues raised by the motion by
              agreement or consent order and that such effort at
              resolution has been unsuccessful, or (2) advised the
              attorney for the opposing party by letter, after the
              default has occurred, that continued non-compliance
              with a discovery obligation will result in an appropriate

                                                                           A-3617-17T2
                                         11
            motion being made without further attempt to resolve
            the matter. . . .

            [R. 1:6-2(c).2]

Here, defense counsel did not claim that during the discovery period he had

made a good faith effort to resolve the matter without resorting to the motion.

      The rule that authorizes motions and sanctions concerning a party's failure

to make discovery is Rule 4:23-5. This rule "codified a two-step procedural

paradigm that must be strictly-adhered to before the sanction of dismissal of a

complaint with prejudice for failing to answer interrogatories or provide other

discovery can be imposed." Thabo v. Z Transp., 452 N.J. Super. 359, 369 (App.

Div. 2017) (citing St. James AME Dev. Corp. v. City of Jersey City, 403 N.J.

Super. 480, 484 (App. Div. 2008)). "These procedural requirements must be

scrupulously followed and technically complied with." Ibid. (citing Sullivan v.

Coverings & Installation, Inc., 403 N.J. Super. 86, 95 (App. Div. 2008)).

      We have explained the need for trial courts to follow the procedural

safeguards of Rule 4:23-5:

2
  This subsection of Rule 1:6-2 makes an exception for actions that have "been
specially assigned to an individual judge for case management and disposition
of all pretrial and trial proceedings and . . . all cases pending in the Superior
Court, Chancery Division." R. 1:6-2(b) & (c). Nothing in the appellate record
identifies this action as such a "specially assigned" case.
                                                                         A-3617-17T2
                                      12
            The best way to foster the public confidence in our civil
            courts is to decide cases on their merits. Discovery
            rules are intended to create a level playing field for all
            litigants and promote the resolution of civil dispute on
            the merits. Judges are entrusted to ensure that these
            rules are properly and fairly enforced.

            [Id. at 371.]

      Rule 4:23-5(a)(1) requires that a movant support the motion by an

affidavit that recites the facts of the delinquent party's default, and states that

the moving party is not in default in any discovery obligations owed to the

delinquent party. This requirement safeguards against the unilateral imposition

of sanctions upon one party when all parties have disregarded their discovery

obligations. In the case before us, defendants could not provide the required

certification because they had disregarded their discovery obligations.

      Rule 4:23-5 also authorizes a court to sanction a party who has failed to

furnish an expert's report. The rule states: "The court at trial may exclude the

testimony of a treating physician or any other expert whose report is not

furnished pursuant to [Rule] 4:17-4(a) to the party demanding same." R. 4:23-

5(b) (emphasis added).      Rule 4:17-4(a) provides in pertinent part: "If the

interrogatory requests the name of an expert or treating physician of the

answering party or a copy of the expert's or treating physician's report, the party

shall comply with the requirements of paragraph (e) of this rule."

                                                                           A-3617-17T2
                                       13
       Defendants in this case invoked the authority of Rule 4:23-5(b) to bar

plaintiffs from presenting expert testimony at trial even though they had never

demanded an expert report pursuant to Rule 4:17-4(a), as they had never served

interrogatories. Defendants and the motion judge overlooked this deficiency in

defendants' motion.

       The provisions of Rule 4:23-5 are intended, among other objectives, "[t]o

ensure the delinquent party is aware of its derelictions and has the opportunity

to correct them." Thabo, 452 N.J. Super. at 369. Here, like Thabo, "the system

failed because both the motion judge and the attorney representing the moving

party failed to follow the strict procedural requirements of Rule 4:23-5." Id. at

371.

                                      IV.

       We conclude by reiterating the Supreme Court's admonition that because

dismissal with prejudice is "the ultimate sanction," it should be imposed "only

sparingly" and "normally . . . ordered only when no lesser sanction will suffice

to erase the prejudice suffered by the non-delinquent party." Robertet Flavors,

Inc. v. Tri-Form Const. Inc., 203 N.J. 252, 274 (2010). Here, that admonition

was overlooked when the motion judge, in effect, dismissed plaintiffs' complaint

by precluding them from presenting proofs of damage at trial.

                                                                         A-3617-17T2
                                      14
      Defendants' motion was filed in disregard of the following requirements ,

deficiencies readily apparent from the motion and supporting certification: (1)

the motion was filed out of time without a showing of good cause (Rule 4:24-

2(a)); (2) defendants did not certify they had made a good faith effort to obtain

the discovery before filing the motion (Rule 1:6-2(c)); (3) defendants did not

certify they were not in default in discovery obligations owed to plaintiffs (Rule

4:23-5(a)(1)); and, (4) defendants invoked Rule 4:23-5(b) to bar plaintiffs from

presenting expert testimony at trial even though defendants had never demanded

an expert as required by Rule 4:23-5(b).

      Plaintiffs were subjected to the functional equivalent of the "ultimate

sanction" even though defendants had not only disregarded their own discovery

obligations, but had also disregarded in their entirety the mandatory provisions

of the rules authorizing the imposition of sanctions for failing to make

discovery.   The trial court misapplied its discretion by disregarding these

mandates without an explanation for doing so and by imposing the equivalent of

the ultimate sanction when the moving parties were delinquent and lesser

sanctions would have sufficed to erase the prejudice to all parties. We thus

vacate the order precluding plaintiffs from presenting expert or other testimony

                                                                          A-3617-17T2
                                       15
concerning their damages. We also vacate the order denying their motion for

reconsideration, as well as the order involuntarily dismissing their case.

      We remand this matter to the trial court for further proceedings. The trial

court shall conduct a conference and issue an order imposing reasonable

deadlines for completion of discovery, dispositive motion practice, and if

necessary, trial. Because defendants had a full opportunity to present their

counterclaim and have not cross-appealed from its dismissal at trial, there is no

need to litigate that issue a second time.

      Reversed and remanded for further proceedings consistent with this

opinion. We do not retain jurisdiction.

                                                                             A-3617-17T2
                                       16