Court Opinion

ID: 4429831
Source: CourtListenerOpinion
Date Created: 2019-08-20 19:31:04.564492+00
Date Added: 2024-06-11T12:47:17.936161
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                                APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.

                                                          SUPERIOR COURT OF NEW JERSEY
                                                          APPELLATE DIVISION
                                                          DOCKET NO. A-2890-16T1

RICHARD NOBIS and
CHRISTINA NOBIS,

           Plaintiffs,

v.

STEVEN BELMONTE and
DWYONIA BELMONTE,

           Defendants-Appellants,

and

WILLIAM V. LANE, JOHNSTONE,
SKOK, LAUGHLIN & LANE,
MATTHEW TAL, HOSPITALITY
SOLUTIONS REALTY SERVICES,
LLC, HOSPITALITY SOLUTIONS,
LLC, HOSPITALITY SOLUTIONS
WORLDWIDE, LLC, RE/MAX
FIRST CHOICE REALTORS,
and PATRICIA DiGERONIMO,

           Defendants,
and

LAURIE BOGAARD,
      Defendant-Respondent.

            Argued September 20, 2018 – Decided December 13, 2018

            Before Judges Alvarez and Nugent.

            On appeal from Superior Court of New Jersey, Law
            Division, Union County, Docket No. L-3595-14.

            Anthony M. Bedwell argued the cause for appellants
            (Jardim, Meisner & Susser, PC, and Bedwell & Pyrich,
            LLC, attorneys; Anthony M. Bedwell, of counsel and
            on the briefs).

            Gregg S. Kahn argued the cause for respondents Laurie
            Bogaard and Bogaard & Associates, LLC (Wilson,
            Elser, Moskowitz, Edelman & Dicker, LLP, attorneys;
            Gregg S. Kahn, of counsel and on the brief; John P.
            O'Toole, on the brief).

PER CURIAM

      Defendants Steven Belmonte and Dwyonia Belmonte appeal the February

1, 2017 grant of partial summary judgment to defendants Bogaard & Associates,

LLC, and Laurie Bogaard, Esquire, (Bogaard) dismissing the Belmonte's

crossclaim for legal malpractice. For the reasons that follow, we affirm.

      In January 2011, the Belmontes entered into an agreement to sell their

home to plaintiffs Richard and Christina Nobis. 1 The agreement was contingent

1
  The plaintiffs and the Belmonte defendants will be referred to by their first
names where necessary to avoid confusion.
                                                                        A-2890-16T1
                                       2
upon the Nobises obtaining a satisfactory home inspection.              The home

inspection report noted that the attic space above the garage had been painted

white, and that a fan had been installed in the den. Concerned that those two

circumstances might indicate a mold problem, the inspector suggested follow-

up.

      On February 10, 2011, the Nobises' attorney, Bogaard, sent the Belmonte's

attorney, William Lane, a copy of the report. At the end of the letter, Bogaard

asked for an explanation of the painting in the attic and the fan in the den. Lane

responded, stating that "what the purchaser has seen is self-explanatory." He

made no mention of any mold problem.

      On February 22, 2011, Bogaard inquired about possible mold conditions,

stating:

            My clients still have concern over the issue as to why
            the attic was painted white. Please advise if the sellers
            have ever experienced any type of mold or other issues
            in the attic and if so, how same was remediated.

      Lane responded on February 23, 2011:

            My clients have never experienced a mold problem in
            the attic. The attic was painted white, assumably
            because that was a personal preference. However, as a
            result of an overflowed toilet during a short term
            tenancy, there was the appearance of a small amount of
            mold in the garage and in a small area in the basement.
            My clients engaged a licensed certified mold

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            remediation company who tested the entire house and
            then remediated the affected area. That remediation
            came with a warranty (see copy attached), which
            remains in full force and effect.

No copy of the warranty was attached, however.

      On February 24, 2011, Bogaard again wrote to Lane: "[a]fter speaking

with my clients, the purchasers find the sellers' response to their concerns

acceptable, with exception to the pool." When deposed, Richard acknowledged

that he had a conversation with Steven around February 24, 2011, during which

Steven mentioned the word "mold," and acknowledged the presence of a small

amount of mold in the basement. During depositions, the Nobises disputed the

extent of the information they had been provided regarding the source and

treatment of the mold, and their receipt of relevant documents. Richard also

said that Steven assured him during the call that the amount of mold in the garage

was small but that mold spores travel. Both Nobises insisted the first time they

actually learned about the existence of the mold was two days prior to closing

when informed by Steven, and that he assured them that the problem had been

addressed. The Nobises assumed the mold report and the warranty would be

produced at closing, which took place on March 1, 2011. They were not given

the documents at that time.

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       When deposed, Lane claimed that he heard Bogaard advise the Nobises at

closing that they had remedies beyond the closing if the mold remediation

documents were not provided. That fall, the Nobises filed suit against their

attorney, the attorney's firm, and the Belmontes. That triggered the Belmontes'

third-party complaint against the Bogaard defendants alleging legal malpractice

and seeking attorney's fees and costs.

       The Belmontes contend that Bogaard owed them a duty of care arising

from Bogaard's representation of the Nobises. Furthermore, they allege that

Bogaard told the Belmontes that she had discussed the mold condition and the

warranty with the Nobises, that the information was acceptable, and that they

went through with the sale relying on the assurance.

       In the February 1, 2017 written order, the trial court said:

             Buyer's attorney does not breach a duty to seller for
             failing to represent Buyer properly.         Petrillo v.
                           2
             Bachenberg[ ] is not applicable, as it addresses duty of
             Seller's attorney to a Buyer whom Seller's attorney
             knows will rely on his misrepresentations. Reasons to
             be set forth more fully on the record at 3 p.m. on Feb.
             2, 2017.

       On February 2, 2017, the trial judge granted the Bogaard defendants'

motion for summary judgment. She concluded as a matter of law that the

2
    139 N.J. 472 (1995).
                                                                        A-2890-16T1
                                         5
Belmontes, who were non-clients, could not assert a legal malpractice claim

against the Bogaard defendants because they failed to establish that the Bogaard

defendants owed any sort of duty to them.

      On February 2, 2017, the court explained:

            If Bogaard told the Belmontes that she discussed the
            mold problem and didn't, I still don't see how this gives
            the Belmontes a cause of action against Bogaard. It
            may well give . . . the Nobises a cause of action for
            breach of their own attorneys' duties, but not the sellers,
            who, of course, it should be noted, were represented by
            counsel themselves, and everything, basically, flowed
            through Mr. Lane or in some circumstances there are
            allegations that Mr. No[b]is – or Mr. Belmonte himself
            made some statements.

            So Petrillo says that under some circumstances . . . an
            attorney assumes a duty to a non-client, which is what
            the Belmontes want here, to provide reliable
            information. That is not the situation we have . . . .

            [T]he buyer's claim is, in large part, against their own
            lawyer, who failed to do her job. But . . . for the sellers
            to say, yes, and now we're in this lawsuit because . . .
            that buyer's attorney didn't do her job, I think there's no
            basis for a cause of action on that.

            There's no duty between the – between the two, and
            certainly it's not the type of situation – if –if I permitted
            that, we would basically be making every adversary's
            or other party to an action's attorney liable to the party
            they're not representing.

            This is too broad a rule, and – and I don't think Petrillo
            makes that rule. . . .          Petrillo says in some

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                                         6
            circumstances, if you expect that a buyer is going to
            rely on the seller's attorney's representations, and the
            buyer is harmed, then the buyer will have a – a cause of
            action. But under any facts that are alleged by either
            side here, I don't see where the Belmontes get a cause
            of action against the Bogaard defendants.

      In dismissing the Belmontes' claim for attorneys' fees and expenses, the

trial court added:

            We've talked about Innes verses Marzano-Lesnovich,
            which is the most recent – recent statement at 224 N.J.
            584 [(2016)] talking about the fiduciary duty that arises
            as an escrow agent in that case, although these people
            happened to be a – attorneys for one of the parties.

                     ....

            [T]here is no case that says a non-client can get
            attorney's fees in an action. . . .

            [A]s the Court noted in Innes, departures from the
            American Rule are the exception. We have awarded
            counsel fees to a prevailing plaintiff in a legal
            malpractice action premised upon professional
            negligence because of the unique nature of the
            attorney/client relationship. Not the unique nature of
            the fiduciary relationship – the unique nature of the
            attorney/client relationship.     And certainly, the
            Belmontes can look to their lawyer, and the Nobises can
            look to their lawyer for those damages.

            But now we are in a situation where they're looking to
            the other party's lawyer, when they do not have the
            unique attorney/client relationship. So – and the Court
            goes on to say [in Innes,] we have never held that a non-

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                                       7
            client is entitled to a fee-shifting award for an attorney's
            negligence.

                  ....

            There's – there's not authority for finding an
            attorney/client relationship. There . . . could be a
            finding that a – fiduciary obligation was breached, but
            that does not necessarily . . . flow from there that the
            attorney/client relationship allowing the recoupment of
            attorney's fees would be permissible. And I note that
            everybody's attorney is already in this case.

      Prior to trial, scheduled for February 6, 2017, all of the claims were

dismissed except for the Nobises' and the Belmontes' claim against Bogaard.

Before trial commenced, the Nobises settled their claims against Bogaard.

      Now on appeal, the Belmontes allege the following points of error:

            POINT I
            THE TRIAL COURT ERRED IN GRANTING THE
            BOGAARD     DEFENDANTS'    MOTION    FOR
            PARTIAL SUMMARY JUDGMENT AGAINST THE
            BELMONTES BECAUSE (A) THE TRIAL COURT
            COMMITTED REVERSIBLE ERROR BY HOLDING
            THAT AS A MATTER OF LAW A SELLER OF REAL
            ESTATE CANNOT MAINTAIN A CAUSE OF
            ACTION FOR PROFESSIONAL NEGLIGENCE
            AGAINST THE BUYER'S ATTORNEY AND (B)
            MATERIAL DISPUTED FACTS TAKEN IN A
            LIGHT MOST FAVORABLE TO THE BELMONTES
            PROHIBIT GRANTING SUMMARY JUDGMENT.

            A.    THE    TRIAL   COURT    COMMITTED
                  REVERSIBLE ERROR BY HOLDING THAT
                  AS A MATTER OF LAW A SELLER OF REAL

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                                         8
                  PROPERTY CANNOT MAINTAIN A CAUSE
                  OF   ACTION    FOR   PROFESSIONAL
                  NEGLIGENCE AGAINST THE REAL ESTATE
                  BUYER'S ATTORNEY.

            B.    MATERIAL DISPUTED FACTS TAKEN IN A
                  LIGHT MOST FAVORABLE TO THE
                  BELMONTES     PROHIBIT   GRANTING
                  SUMMARY JUDGMENT BECAUSE THOSE
                  FACTS TAKEN IN A LIGHT MOST
                  FAVORABLE TO THE NON-MOVING
                  PARTY PROVIDE SUFFICIENT FACTS TO
                  CONCLUDE    THAT    THE  BOGAARD
                  RESPONDENTS BREACHED THEIR DUTY
                  OF CARE OWED TO THE BELMONTES AND
                  THAT THE BOGAARD'S BREACH OF DUTY
                  PROXIMATELY CAUSED DAMAGES TO
                  THE BELMONTES.

            POINT II
            THE TRIAL COURT ERRED BY GRANTING THE
            BOGAARD DEFENDANTS' PARTIAL SUMMARY
            JUDGMENT DISMISSING THE BELMONTE'S
            CLAIM FOR RECOVERY OF FEES AND COSTS
            INCURRED IN PROSECUTING THE CLAIMS
            AGAINST THE BOGAARD DEFENDANTS.

                                      I.

      We review summary judgment decisions de novo, applying the same

standard used by the trial court. Rowe v. Mazel Thirty, LLC, 209 N.J. 35, 41

(2012) (citing Henry v. N.J. Dep't of Human Servs., 204 N.J. 320, 330 (2010)).

Summary judgment is properly granted when no genuine issue of material fact

exists, considering the evidence in the light most favorable to the non -moving

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                                      9
party, and the moving party is entitled to prevail as a matter of law. Ibid. (citing

Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 529 (1995)); R. 4:46-2(c).

Any issue of material fact has to be "genuine."           Brill, 142 N.J. at 529.

"[Q]uestions of law [are] particularly suited for summary judgment." Badiali v.

N.J. Mfrs. Ins. Grp., 220 N.J. 544, 555 (2015) (citation omitted). Such is the

case in this appeal.

      In order to succeed on a legal malpractice claim, the proponents must

establish: (1) the existence of an attorney-client relationship that creates a duty

of care upon the attorney; (2) a breach of that duty; (3) proximate causation of

the damages claimed by the plaintiff; and (4) actual damages. See Cortez v.

Gindhart, 435 N.J. Super. 589, 598 (App. Div. 2014); see also Sommers v.

McKinney, 287 N.J. Super. 1, 9-10 (App. Div. 1996).

      Not surprisingly, where no attorney-client relationship exists, the standard

is considerably more stringent. The duty owed by counsel to a non-client

requires close scrutiny—"balancing the attorney's duty to represent clients

vigorously, [RPC 1.3], with the duty not to provide misleading information on

which third parties foreseeably will rely, [RPC 4.1]." Petrillo, 139 N.J. at 479.

      In Petrillo, the Supreme Court recognized that "[t]he determination of the

existence of a duty is a question of law for the court.” Id. at 479. Furthermore,

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                                        10
"attorneys may owe a duty of care to non-clients when the attorneys know, or

should know, that non-clients will rely on the attorneys['] representations and

the non-clients are not too remote from the attorneys to be entitled to protection."

Id. at 483-84.

      Nonetheless, the nature of the relationship between the attorney and the

non-client is critical to the determination. Banco Popular N. Am. v. Gandi, 184

N.J. 161, 180 (2005). "[I]f the attorney does absolutely nothing to induce

reasonable reliance by a third party, there is no relationship to substitute for the

privity requirement." Ibid. As the Court phrased it, "the invitation to rely and

reliance are the linchpins of attorney liability to third parties." Id. at 180-81.

Indeed, in determining the nature of privity between third parties and an

attorney, the latter's duty is limited to those situations in which the attorney

intended or should have foreseen that the third party would rely on the lawyer's

work. Petrillo 139 N.J. at 482. The attorney must have withheld information or

made outright misrepresentations knowing that the non-client will rely on the

information. Ibid.

      In this case, the Belmontes were represented by their own attorney.

Communications regarding the upcoming closing took place between counsel,

not between the Bogaard defendants and the sellers. From this record, it seems

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                                        11
clear that other than seeing Bogaard's letters to Lane, there was no direct

communication between the Bogaard defendants and the sellers. The Belmontes

did not even attend the closing. In fact, when Steven spoke to the Nobises on

the phone, he attempted to reassure them about the mold problem, about which

his own attorney had initially claimed no knowledge.

      To state that no duty of care existed between the Bogaard defendants and

the Belmontes under these circumstances is to state the obvious. The Belmontes

claim that the Bogaard defendants misrepresented to the Belmontes' attorney

that Bogaard had discussed the mold condition and the related warranty with the

Nobises, and that it was acceptable to them. This mischaracterizes the record.

No mention of the mold was made in Bogaard's February 24, 2011 letter.

Bogaard was merely attempting to update the Belmontes' attorney as to the status

of the sale. Nothing in that letter indicated she had discussed the mold condition

or the warranty with the Nobises.

      As we have said, Lane initially denied knowledge of any mold problem.

When on February 28, 2011, Bogaard wrote again requesting all the paperwork

regarding mold remediation along with a copy of the warranty, nothing was

forthcoming before or at the closing. Bogaard did not know the extent of the

mold condition, nor did she make any representations on which the Belmontes

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                                       12
relied. The record presented to the judge who decided the motion for summary

judgment did not include any genuine disputes of material fact. The Bogaard

defendants were not party to the telephone conference during which Steven

appeared to have minimized, at least according to the Nobises, the extent of the

mold condition.

      The judge did not err by granting the motion. To have done otherwise

would have distorted the meaning of Petrillo. That case simply did not make

attorneys liable to third parties represented by their own counsel for any alleged

malpractice in circumstances such as these.

                                        II.

      The Belmontes also challenge the award of summary judgment on their

request for counsel fees, based on Saffer v. Willoughby, 143 N.J. 256, 271

(1996). However, as the Supreme Court pronounced in Innes, attorney's fees

and costs are not recoverable by a non-client against a lawyer in a negligence

case. See Innes v. Marzano-Lesnevich, 224 N.J. 584, 597 (2016). The Innes

Court reiterated that departures from the American rule are the exception, and

that a non-client is not entitled to a fee-shifting award for an attorney's alleged

negligence. Ibid.

      Affirmed.

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                                       13