Court Opinion

ID: 6501055
Source: CourtListenerOpinion
Date Created: 2022-07-19 14:07:15.631705+00
Date Added: 2024-06-11T09:40:50.646813
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NOT FOR PUBLICATION WITHOUT THE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-1370-20

1707 REALTY, LLC,

          Plaintiff-Appellant,

v.

REVOLUTION ARCHITECTURE,
LLC, CONRAD RONCATI, R.A.,
ARCHITECTURA, INC.,
JOHNSON SOILS COMPANY,
LISA V. MAHLE-GRECO, P.E.,
BERTIN ENGINEERING
ASSOCIATES, INC., and
CALSISTO BERTIN, P.E.,

     Defendants-Respondents.
______________________________

REVOLUTION ARCHITECTURE,
LLC, CONRAD RONCATI, R.A.,
and ARCHITECTURA, INC.,

          Defendants/Third-Party
          Plaintiffs,

v.

ULTRA GENERAL
CONTRACTING CORP., ULTRA
GENERAL CONTRACTING, INC.,
d/b/a ULTRA GENERAL
CONTRACTING ENTERPRISES,
INC., and ULTRA ENTERPRISES,
LLC, d/b/a ULTRA GENERAL
CONSTRUCTION ENTERPRISES,
INC.,

      Third-Party Defendants-
      Respondents,

and

STALWART CONSTRUCTION,
LLC, STALWART
CONSTRUCTION, INC.,
STALWART CONSTRUCTION
GROUP, INC., and GREGORY
FASSANO, LLC,

     Third-Party Defendants.
______________________________

JOHNSON SOILS COMPANY,
LISA V. MAHLE-GRECO, and
CALSISTO BERTIN, P.E.,

      Defendants/Third-Party
      Plaintiffs,

v.

STALWART CONSTRUCTION,
LLC, STALWART
CONSTRUCTION, INC.,
STALWART CONSTRUCTION
GROUP, INC., ULTRA GENERAL
CONTRACTING CORP., ULTRA

                                     A-1370-20
                                 2
GENERAL CONTRACTING, INC.,
d/b/a ULTRA GENERAL
CONTRACTING ENTERPRISES,
INC., ULTRA ENTERPRISES,
LLC, d/b/a ULTRA GENERAL
CONSTRUCTION ENTERPRISES,
INC., GREENFIELD
CONSTRUCTION GROUP,
GREGORY FASSANO, LLC,
MARCH ASSOCIATES, INC., and
PETILLO INCORPORATED,

      Third-Party Defendants,

and

ROY ROCK, LLC,

     Third-Party Defendant-
     Respondent.
______________________________

BERTIN ENGINEERING
ASSOCIATES, INC., and
CALISTO BERTIN, P.E.,

      Defendants/Third-Party
      Plaintiffs,

v.

STALWART CONSTRUCTION,
LLC, STALWART
CONSTRUCTION GROUP, INC.,
individually and d/b/a STALWART
CONSTRUCTION, LLC, ULTRA
GENERAL CONTRACTING
CORP., ULTRA GENERAL

                                      A-1370-20
                                  3
CONTRACTING INC., d/b/a
ULTRA GENERAL
CONTRACTING ENTERPRISES,
INC., ULTRA ENTERPRISES
LLC, d/b/a ULTRA GENERAL
CONSTRUCTION ENTERPRISES,
INC.,

     Third-Party Defendants.
______________________________

         Argued February 9, 2022 – Decided July 19, 2022

         Before Judges Hoffman, Whipple, and Geiger.

         On appeal from the Superior Court of New Jersey, Law
         Division, Bergen County, Docket No. L-2202-17.

         Leonard E. Seaman argued the cause for appellant 1707
         Realty, LLC (The Law Offices of Richard Malagiere,
         PC, attorneys; Richard Malagiere, of counsel; Leonard
         E. Seaman, of counsel and on the briefs).

         Robyn S. Rubin argued the cause for respondents
         Revolution Architecture, LLC, Conrad Roncati, R.A.
         and Architectura, Inc. (Milber Markris Plousadis &
         Seiden, LLP, attorneys; Robyn S. Rubin, on the brief).

         Jill A. Mucerino argued the cause for respondents
         Johnson Soils Company, Lisa V. Mahle-Greco, P.E.,
         and Calisto Bertin, P.E., i/p/a Calsisto Bertin, P.E.
         (Wood Smith Henning & Berman, LLP, attorneys; Jill
         A. Mucerino, on the brief).

         Michael J. Jubanyik argued the cause for respondents
         Bertin Engineering Associates, Inc., and Calisto Bertin,
         P.E. (Reilly, McDevitt & Henrich, PC, attorneys;

                                                                    A-1370-20
                                    4
            Michael J. Jubanyik and Christine J. Viggiano, on the
            brief).

PER CURIAM

      Plaintiff 1707 Realty, LLC (1707 Realty) appeals from November 20,

2020 Law Division orders dismissing with prejudice its complaint against

defendants on the basis of the entire controversy doctrine and Rule 4:5-1(b)(2).

Plaintiff also appeals from a January 12, 2021 order denying reconsideration.

For the reasons that follow, we affirm.

                                          I.

      We ascertain the following facts from the record. Plaintiff, a New Jersey

limited liability company, was established by its principals, Moshe Winer and

Martin Taub, to develop the Fairfield Marriott Inn Hotel (the Project) in North

Bergen. Tal Winer is 1707 Realty's Vice President.

      As the result of construction defects at the Project, on March 24, 2017,

plaintiff filed its complaint in the matter under review, naming the following

parties as defendants: JSC, a New Jersey corporation that performs geotechnical

and special inspection services, including third-party inspections of concrete and

rebar; Lisa V. Mahle-Greco, P.E., a professional engineer in the State of New

Jersey and employee of JSC; Calisto Bertin, P.E., a professional engineer in the

State of New Jersey and principal of JSC and Bertin Engineering Associates,

                                                                            A-1370-20
                                          5
Inc.; Bertin Engineering Associates, Inc., a New Jersey corporation that

provides civil engineering services; and Conrad Roncati, R.A., a registered

architect in the State of New Jersey and principal of defendants Revolution

Architecture LLC and Architectura, Inc.

      Despite initiating this action for construction defects, plaintiff did not

name its initial general contractor, Stalwart Construction LLC (Stalwart), or its

owner and president, Vincent DiGregorio, as defendants. Both Stalwart and its

subcontractor, Ultra General Contracting Corp. (Ultra), are named as third-party

defendants in the matter under review; however, only Ultra appeared as Stalwart

defaulted.

The Project

      In April 2014, plaintiff entered into an agreement with Stalwart, as general

contractor, to perform site work at the Project. Shortly thereafter, Stalwart

commenced work. In September 2014, JSC began performing inspections of

Stalwart's work.

      On September 12, 2014, plaintiff entered into an agreement with Stalwart

for the construction of a seven-story, 100-room hotel structure (the Tower) at

the Project. Stalwart began work on the Tower on December 17, 2014.

                                                                            A-1370-20
                                        6
      In April 2015, plaintiff retained Bryan Sullivan of PTC Consultants to

serve as the owner's representative for the Project. Sullivan was responsible for

the day-to-day management of the Project. Sullivan oversaw the progress of the

Project and the status of its completion.

      In May 2015, Sullivan assessed the quality of the work and alerted

plaintiff regarding defects in the construction of the Project.     The defects

identified by Sullivan related to both site work and work on the Tower. Around

the same time, plaintiff became aware of alleged deficiencies with respect to

JSC's inspections.

      Sullivan was the person most knowledgeable about the defects at the

Project. According to plaintiff, Sullivan was the primary individual responsible

for noting and documenting the allegedly defective conditions. Although unsure

of its existence, plaintiff's principal, Moshe Winer, testified to never seeing a

formal report prepared by Sullivan regarding the defective conditions.

      By May 2015, Sullivan determined that Stalwart was not acting in

compliance with its contracts. As a result, on May 22, 2015, plaintiff issued a

Notice of Non-Compliance [w]ith Contract to Stalwart. The notice stated, in

part, that Stalwart failed to provide "standard protocol for Code[-]required

controlled inspections, scheduling, and on-site or office inspection," which was

                                                                           A-1370-20
                                        7
central to JSC's involvement with the Project.      Thereafter, Stalwart began

performing remedial work under the supervision and guidance of Sullivan.

      On September 28, 2015, plaintiff issued a Notice of Default to Stalwart

on the Tower contract. The Notice of Default stated that Stalwart failed "to

construct the project in accordance with industry standards[,] including but not

limited to[,] local building codes, in particular numerous failure[s] in the

placement of rebar and the pouring of concrete which required and continues to

require extensive remediation." Shortly thereafter, on October 7, 2015, plaintiff

terminated Stalwart's contracts for cause. At the time of Stalwart's termination,

the Project was partially completed, up to the second floor.

      After Stalwart's termination in October 2015, March Associates

Construction, Inc. (March) replaced Stalwart at the Project. Sullivan prepared

March's scopes of work for both remedial work and for remaining and

incomplete work. According to plaintiff, no remedial work was done without

Sullivan's knowledge.

      By August 15, 2017, the Project had been remediated and the North

Bergen Building Department issued a certificate of occupancy. Plaintiff credits

Sullivan with having "saved the project." Notably, plaintiff failed to put the

                                                                           A-1370-20
                                       8
defendants on notice of its claims against them prior to March remediating and

completing the Project.

      One day later, on August 16, plaintiff issued summonses to defendants in

this matter. After receiving a copy of the complaint, defendant Calisto Bertin

left the following voicemail for Sullivan:

            Bryan this is Calisto. You've probably getting a call
            from Conrad too, but I got a gift which I f**king didn't
            expect, and I have never done this before, but I am
            going to f**k this job as best I can. I am gonna go
            down, and I am going to use all my influence to f**k
            this job. Maybe if someone wants to call me and
            explain what all this about, we can do something about
            it, but right now. . . . Not you, your employer created a
            f**kin' enemy. Bye.

Claims Based on Sullivan's Work Product

      Plaintiff's allegations as to both the claimed defects and damages are

based upon information supplied by Sullivan.             Specifically, plaintiff's

identification of defects, remedial work, and its calculation of damages are based

upon information included in a "change order log" prepared by Sullivan.

Moreover, plaintiff admitted that its calculation of damages is not based upon

the personal knowledge of its principals or its own documents, but rather, upon

the records of Bryan Sullivan.

      The following exchange occurred at the deposition of Tal Winer:

                                                                            A-1370-20
                                        9
            Q:     Okay. Could you tell me, as you sit here today,
                   where those numbers come from and what work
            is     reflected and included in the remediation costs
            and    the change orders for remediation work?

            A:     Yes. I believe all of Mr. Sullivan's records were
                   provided in -- in -- at the site. The paper records,
                   I believe we provided as whatever digital records
                   we had of his. And I remember, this was from -
            -      he would keep meticulous spreadsheets of all the
                   change orders. He would have his notes, he had
                   many columns of notes. He would label them and
                   categorize them with the values. So I mean, I am
                   sure you have seen his records and we produce a
            lot    of records.

            Q:    So what I am asking you, though, is there a
                  document where Mr. Sullivan identified
            $340,295 for change orders for additional
            remediation work?      Where did the number come
            from, I guess, is what I would like to know?

            A:      So I believe he had -- he had at least a couple of
                    spreadsheets for change orders, one for the site
                    work, one for the tower contract, huge
            spreadsheets        where he labeled the change order
            based on the        proposed change order number, the -
            - . . . And he      would say whether or not it was
            remedial in nature        and he would describe what
            the change order was about. So that's where we got
            those numbers.

Since Winer did not personally create the document, he testified regarding his

review of the change order log, stating, "[T]o the best of my abilities, in good

faith, I tried to figure out what was remedial in nature."

                                                                          A-1370-20
                                       10
      The claimed defects were not identified with specificity until June 18,

2020, at which time plaintiff produced its expert witness reports authored by

Thornton Tomasetti, Inc. and Christopher Ling, AIA. Both Ling and Tomasetti

opined as to defects pertaining to concrete and rebar installed by Stalwart.

Plaintiff's experts did not undertake first-hand observations of work progress,

the defective conditions, or the remedial efforts.

      In addition to opining as to Stalwart's defective work, both Ling and

Tomasetti offered opinions as to the approval of payment applications for "work

that either was not completed at all or was incomplete." Plaintiff specifically

claims it suffered damages due to the improper approval of incomplete work for

payment, as set forth in Payment Application Requisition No. 8. This claim is

based upon an analysis undertaken by Sullivan.

Claimed Damages

      In addition to establishing liability, the damages claimed by plaintiff are

also based upon information supplied by Sullivan, which plaintiff's experts used

in calculating plaintiff's damages totaling $4,005,731, including costs caused by

delay of construction, overpayment, and remediating defective construction. In

support of the damages sought in this litigation, plaintiff retained Robert

Valentin Consulting (Valentin) as an expert, which issued a report dated

                                                                           A-1370-20
                                       11
February 17, 2020 (the Valentin Report).       Plaintiff submitted the Valentin

Report to support the recovery of "costs incurred due to overpayments, deficient

installation[,] and delays," which allegedly total $1,653,754.46. The Valentin

Report opines defendants are responsible for the claimed costs due to their

failure to identify Stalwart's deficient installation for which Stalwart was

overpaid.

Engineered Devices Litigation

      On November 13, 2015, while the Project was ongoing, Engineered

Devices Corporation initiated a legal action against 1707 Realty and Stalwart in

the Superior Court of New Jersey, Hudson County to recover on a construction

lien claim. Engineered Devices Corporation v. 1707 Realty LLC, No. L-4673-

15 (the Engineered Devices Litigation). On February 11, 2016, plaintiff filed

crossclaims against Stalwart and DiGregorio.

      The Facts Common to All Counts, as stated in plaintiff's crossclaim,

provided, in pertinent part:

            (2) Stalwart failed to supply sufficient properly
            skilled     workers or proper materials or equipment
            to     complete the project . . .

             (3) By letter dated September 28, 2015, 1707
            provided Stalwart with a Notice of Default and
            opportunity to cure.

                                                                          A-1370-20
                                      12
                          ....

              (6) As a result of Stalwart's failure to cure the
             default,    on or about October 8, 2015, 1707
             terminated the  Contract for cause . . .

             (7)   Prior to termination of the Contract, Stalwart
                   submitted, on a periodic basis, Application and
                   Certification     for    Payment     ("Payment
             Applications")     to 1707 signed by DiGregorio as a
             condition to get progress payments.

             (8)    DiGregorio certified to 1707 in the Payment
                    Applications that the work . . . was completed in
                    accordance with the Contract Documents . . .

             (9) At the time DiGregorio made these
             certifications . . . the work . . . was not completed in
             accordance with the Contract Documents.

      Count One of plaintiff's crossclaim was against DiGregorio for fraud

relating to payment applications submitted for the Project, in his capacity as

Stalwart's representative.    Count Three was against Stalwart for breach of

contract for its failure and refusal to provide plaintiff sufficient properly skilled

workers or proper materials at the Project. Relevant to the matter under review,

plaintiff alleged defective work product and "numerous construction defects"

against Stalwart.

      In accordance with the Rule 4:5-1, plaintiff's attorney filed a certification

with plaintiff's crossclaim, stating:

                                                                               A-1370-20
                                        13
            I further certify pursuant to [Rule] 4:5-1 that the matter
            in controversy is not the subject matter of any other
            action pending in any Court or of a pending arbitration
            proceeding . . . I further certify that to the best of my
            knowledge, information and belief, no other party
            should be joined in this action.

      On May 19, 2016, plaintiff filed a motion for leave to file a third-party

complaint against Ultra and Gregory Fassano, LLC d/b/a "Global Group"

(Global) in the Engineered Devices Litigation. In a supporting certification,

plaintiff's attorney stated that "1707 [Realty] seeks to recover from Global and

Ultra for damage to the property."     He further certified that "1707 [Realty's]

claims against Global and Ultra should be included as part of the matters in

controversy to allow a full and complete resolution of all claims in one forum."

      After receiving leave of court, plaintiff filed a third-party complaint

against Ultra and Global in the Engineered Devices Litigation in June 2016.

Plaintiff alleged that Ultra and Global each entered into a subcontract with

Stalwart to provide labor and materials within the concrete scope of work in the

construction of the Project. Plaintiff further alleged that Ultra and Global each

"failed to construct the project in accordance with industry standards[,]

including but not limited to[,] local building codes" and that their failure

"required and continue to require extensive remediation by 1707 to portions of

the project." Moreover, plaintiff alleged that "[t]he negligence, carelessness, or

                                                                            A-1370-20
                                       14
recklessness" of Ultra and Global were the "proximate cause of damages

suffered by 1707." Plaintiff's attorney filed a certification attached to plaintiff's

third-party complaint, stating:

             I certify pursuant to [Rule] 4:5-1 that the matter in
             controversy is not the subject matter of any other action
             pending in any Court or of a pending arbitration
             proceeding . . . I further certify that to the best of my
             knowledge, information and belief, no other party
             should be joined in this action.

Judgment in the Engineered Devices Litigation

      On January 25, 2017, an Order for Final Judgment (the DiGregorio

Judgment) was entered against Vincent DiGregorio as to plaintiff's crossclaim

for fraud in the amount of $681,506 in the Engineered Devices Litigation.

Plaintiff's calculation of the DiGregorio Judgment included consideration of

overpayment made to Stalwart, as well as damages incurred by plaintiff with

respect to remedial work at the Project.

      Plaintiff's representative, Moshe Winer, testified at deposition in this

matter as follows:

             Q:     Why did you decide that your options were better
                    pursuing the design professionals in this
             litigation for at least some of the same damages that
             you already have a judgment for in another litigation?

             A:      That's what you call double dipping, that's what
             you     --

                                                                              A-1370-20
                                        15
             Q:     No, I am not. I am asking you why you made that
                    determination, to pursue a judgment on the same
                    grounds, at least in part, against design
                    professionals in this litigation when you already
             had a judgment for those damages in another
             litigation?

             A:     Look, I . . . hired professionals and I have to take
                    responsibility for who I hired. I believe I
             hired . . . a good team and that's the advice I got and
             that's what I did . . . . We chose not to sue Stalwart for
                    negligence or for breach of contract, because we
                    realized it's a sham and there's nothing there,
             there's      no asset to recover . . . from Stalwart.
             Again, it was        a business decision.

The Present Action

      Before the Project had been completed and fully remediated, plaintiff

initiated the matter under review by filing a complaint in Bergen County on

March 24, 2017. However, plaintiff did not serve the complaint until August

22, 2017, after the certificate of occupancy for the Project was issued; as a result,

defendants were unaware of the claims pending against them until that time. In

its complaint, plaintiff alleged that JSC entered into an agreement to provide

construction testing and monitoring of certain aspects of the Project, including

testing and monitoring of cast-in-place concrete, masonry, and structural steel

installations at the Project, and further, that they are liable for defects in the

construction of the Project because they "failed to observe and/or failed to

                                                                              A-1370-20
                                        16
require the general contractor to correct various deficiencies in the project." The

complaint and subsequent iterations, filed in the form of first, second and third

amended complaints, alleged defects in the construction of the footings, stairs,

columns, foundation, and use of unacceptable fill.

      In October 2017, defendant JSC filed an answer, at which time it asserted

an affirmative defense stating: "This claim is barred by the entire controversy

doctrine." Defendant Revolution filed an answer to the initial complaint on

October 24, 2017, and thereafter filed answers to the first, second and third

amended complaints on January 24, 2018, May 24, 2018, and October 30, 2019,

respectively.   Revolution denied all allegations, including all allegations

grounded in negligence, fraud, corruption, or any other intentional tort, and

asserted affirmative defenses denying the same.

      In November 2017, defendants served discovery demands on plaintiff.

Defendant Revolution filed a third-party complaint against Stalwart on January

3, 2018, and thereafter on third-party defendant Ultra. Third-party complaints

were also filed by defendants JSC, Lisa V. Mahle-Greco, Calisto Bertin, and

Bertin Engineering against Ultra and other subcontractors. Of the named third-

party defendants, only Ultra appeared.       The named third-party defendants

                                                                             A-1370-20
                                       17
worked as subcontractors under Stalwart, and were alleged to have performed,

in part, the defective and deficient work for which plaintiff claimed damages.

      Plaintiff did not serve its answers to interrogatories until May 17, 2018,

at which time Sullivan was identified for the first time as a person with

knowledge of facts relevant to this case. By that time, he had been deceased for

over two months. It was not until two years later – on June 18, 2020 – that

plaintiff produced a liability expert report identifying with specificity its claims

against defendants.

      On September 9, 2020, JSC moved for dismissal of plaintiff's third-

amended complaint based upon the entire controversy doctrine and plaintiff's

failure to comply with Rule 4:5-1. In sum, the motion sought dismissal of the

complaint with prejudice based upon plaintiff's failure to identify or join

defendants in the Engineered Devices Litigation. The other co-defendants filed

cross-motions to dismiss on the same grounds. On October 6, 2020, plaintiff

filed an omnibus opposition to defendants' motions.

      On November 20, 2020, the motion judge granted defendants' motions and

issued orders dismissing plaintiff's complaint with prejudice based on the entire

controversy doctrine and violations of Rule 4:5-1. Plaintiff filed a motion for

reconsideration, which the motion judge denied on January 12, 2021.

                                                                              A-1370-20
                                        18
This appeal followed, with plaintiff raising the following arguments:

     I.     THE STANDARD OF REVIEW

     II.  THE BERGEN TRIAL COURT ABUSED ITS
          DISCRETION IN APPLICATION OF RULE
     4:5- 1.

            A.   THE COURT ERRED BY FAILING
                 TO CONSIDER THE REASON
                 FOR DELAY IN BRINGING THIS
                 LITIGATION.

            B.   THE BERGEN COURT ERRED IN
                 FINDING THAT DEFENDANTS
                 WERE       "SUBSTANTIALLY
                 PREJUDICED."

            C.  THE BERGEN TRIAL COURT
                ERRED    IN  FAILING  TO
            CONSIDER     WHETHER     ANY
            LESSER SANCTION          WAS
            APPROPRIATE.

     III.   THE BERGEN TRIAL COURT ERRED AS A
            MATTER OF LAW WHEN IT APPLIED RULE
            4:5-1 TO THE ESTABLISHED FACTS.
            A.    THIS IS NOT A "SUBSEQUENT"
                  ACTION.

            B.   1707 COMPLIED WITH RULE 4:5-
                 1.

     IV.    THE BERGEN TRIAL COURT ERRED IN
            FINDING  THAT    THE  DIGREGORIO
            JUDGMENT PRECLUDES RECOVERY FROM
            DEFENDANTS HERE.

                                                                   A-1370-20
                               19
            V.    THE BERGEN TRIAL COURT ERRED IN
                  FAILING TO CONSIDER THE MATERIALS
                  SUPPLIED WITH THE MOTION FOR
                  RECONSIDERATION.

                                       II.

      We review the grant or denial of a motion to dismiss under the same

standards as the trial court. Sickles v. Cabot Corp., 379 N.J. Super. 100, 106

(App. Div. 2005). Where the decision being appealed is based on equitable

principles, we review the trial court's findings under an abuse of discretion

standard. BOC Group, Inc. v. Chevron Chem. Co., 359 N.J. Super. 135, 145

(App. Div. 2003) (citing Paradise Enters. Ltd. v. Sapir, 356 N.J. Super. 96, 102

(App. Div. 2002)).

      Moreover, it is well settled that "[t]he entire controversy doctrine is an

equitable principle and its application is left to judicial discretion."     700

Highway 33 LLC v. Pollio, 421 N.J. Super. 231, 238 (App. Div. 2011) (citing

Allstate N.J. Ins. Co. v. Cherry Hill Pain & Rehab. Inst., 389 N.J. Super. 130,

141 (App. Div. 2006)). The doctrine's "application is left to judicial discretion

based on the factual circumstances of individual cases." Dimitrakopoulos v.

Borrus, 237 N.J. 91, 114 (2019) (quoting Highland Lakes Country Club & Cmty.

Ass'n v. Nicastro, 201 N.J. 123, 125 (2009)). When reviewing the trial court's

                                                                           A-1370-20
                                      20
exercise of such discretion, we will reverse the trial court's decision only if it

was clearly erroneous. State v. Simon, 161 N.J. 416, 444 (App. Div. 1999).

      Plaintiff argues that we should conduct de novo review based on the

Court's decision in Dimitrakopoulos, 237 N.J. at 108. There, in a case involving

the entire controversy doctrine, the Supreme Court expressed that "[a]n appellate

court reviews de novo the trial court's determination of the motion to dismiss

under Rule 4:6-2(e). Ibid. However, Dimitrakopoulos is distinguishable in that

it involved application of the entire controversy doctrine to a legal malpractice

claim.   The Court wrote, "[t]he entire controversy doctrine raises special

concerns when invoked in the setting of legal malpractice." Id. at 109 (citing

Olds v. Donnelly, 150 N.J. 424, 446 (1997)). As such, the exercise of de novo

review in Dimitrakopoulos was a result of the narrow facts concerning legal

malpractice; the case does not stand for the proposition that all entire

controversy claims should be reviewed de novo.

                                       A.

      The two goals of the entire controversy doctrine are "ensuring fairness to

parties and achieving economy of judicial resources." Kent Motor Cars, Inc. v.

Reynolds & Reynolds, 207 N.J. 428, 443 (2011).         Our Supreme Court has

accomplished these goals by requiring joinder of claims, Rule 4:30A, and by

                                                                            A-1370-20
                                       21
requiring the parties to identify in their first pleadings "the names of any non-

party who should be joined in the action pursuant to R. 4:28 or who is subject

to joinder pursuant to R. 4:29-1(b) because of potential liability to any party on

the basis of the same transactional facts." R. 4:5-1(b)(2). The parties to an

action have a continuing obligation to amend the initial disclosure if there is a

change in the facts stated in the original certification, and "the court may impose

an appropriate sanction including dismissal of a successive action against a party

whose existence was not disclosed[.]" Ibid.

      When a trial court is presented with a motion to dismiss based on the entire

controversy doctrine,

            [it] must first determine whether a Rule 4:5–1(b)(2)
            disclosure should have been made in a prior action
            because a non-party was subject to joinder pursuant
            to Rule 4:28 or Rule 4:29-1(b). If so, the court must
            then determine whether (1) the actions are "successive
            actions," (2) the opposing party's failure to make the
            disclosure in the prior action was "inexcusable," and
            (3) "the right of the undisclosed party to defend the
            successive action has been substantially prejudiced by
            not having been identified in the prior action." R. 4:5-
            1(b)(2). If those elements have been established, the
            trial court may decide to impose an appropriate
            sanction. Dismissal is a sanction of last resort.

            [700 Highway 33 LLC, 421 N.J. Super. at 236-37.]

                                                                             A-1370-20
                                       22
      Notably, the primary inquiry concerns whether both actions "arise from

related   facts   or   the   same   transactions   or   series   of   transactions."

Dimitrakopoulos, 237 N.J. at 109 (quoting DiTrolio v. Antiles, 142 N.J. 253,

267 (1995)). "The doctrine does not mandate that successive claims share

common legal issues in order for the doctrine to bar a subsequent actio n." Ibid.

(citing Wadeer v. N.J. Mfrs. Ins. Co., 220 N.J. 591,605 (2015) and Ditrolio, 142

N.J. at 271). Rather, we must determine whether the separate claims are part of

a "single larger controversy because they arise from interrelated facts." Ibid.

(quoting DiTrolio, 142 N.J. at 271).

      Application of the entire controversy doctrine is meant to "prevent a party

from voluntarily electing to hold back a related component of the controversy

in the first proceeding by precluding it from being raised in a subsequent

proceeding thereafter." Hobart Bros. Co. v. Nat'l Union Fire Ins. Co., 354 N.J.

Super. 229, 240-41 (App. Div. 2002) (quoting Oltremare v. ESR Custom Rugs,

Inc., 330 N.J. Super. 310, 315 (App. Div. 2000)). Moreover, while the "entire

controversy doctrine is not intended to be a trap for the unwary[,]" we must also

be aware of the "possibility that a party has purposely withheld claims from an

earlier suit for strategic reasons or to obtain "two bites at the apple." Id. at 241.

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                                        23
      Here, the motion judge properly exercised his discretion in determining

that Rule 4:5-1(b)(2) applies in the present matter. Namely, the judge properly

found that a Rule 4:5-1(b)(2) disclosure should have been made in the Hudson

County Engineered Devices Litigation.

      A Rule 4:5-1(b)(2) disclosure was required because the present action and

the Engineered Devices Litigation arose out of the same transactional facts. The

basis of plaintiff's claims in both matters involved Stalwart's defective

workmanship during the course of construction at the Project and the fraudulent

representations made regarding the quality of the workmanship.               In the

Engineered Devices Litigation, plaintiff's crossclaim for breach of contract

against Stalwart claimed defective workmanship and construction defects. In

the present matter, plaintiff is seeking recovery for damages originally caused

by Stalwart's defective construction, such as defects in "concrete footings, stairs,

columns, foundations, and use of unacceptable fill," and specifically for

defendants' failure to inspect, identify and correct such defects that ultimately

resulted in remediation.

      Additionally, plaintiff's third-party complaint against Ultra in the

Engineered Devices Litigation alleged that Ultra was liable for defective work

and damages. The complaint further alleged that Ultra entered into contracts

                                                                              A-1370-20
                                        24
with Stalwart to provide labor and materials. Plaintiff alleged that Ultra failed

to adhere to industry standards, including local building codes, resulting in

extensive remediation by plaintiff. In the present matter, plaintiff's allegations

regarding defects and remedial costs similarly derive from defective

workmanship on the Project.

      Moreover, plaintiff's claims against DiGregorio in the Engineered Devices

Litigation were for fraudulent payment requisitions, or fraud relating to

misrepresentations made in payment applications regarding the quality and

status of the project. In the present matter, plaintiff alleges that defendants

Revolution, Roncati, and Architectura "improperly certified various contractor

payment applications certifying that the general contractor performed work that

it had not done." The facts giving rise to plaintiff's claim in the present matter,

namely fraud allegations against defendants Revolution, Roncati, and

Architectura, are the exact same as those offered in support of plaintiff's fraud

claims against DiGregorio in the Engineered Devices Litigation.

      In sum, plaintiff's claims and the damages sought in both actions relate to

Stalwart's defective performance and fraudulent representations made regarding

the quality and status of the work. Accordingly, the same set of interrelated

transactional facts form the basis for both the present action and the Engineered

                                                                             A-1370-20
                                       25
Devices Litigation; as a result, we find no abuse of discretion in the motion

judge's finding that Rule 4:5-1(b)(2) applies to the present matter.

      We next address plaintiff's contention that the present matter is not subject

to the entire controversy doctrine because it is not a successive action, but rather

a concurrent action. Plaintiff argues that the complaint in this action was filed

March 24, 2017, and that plaintiff filed an amended certification in the

Engineered Devices Litigation two weeks later on April 5, 2017. Therefore,

plaintiff submits that on March 24, 2017, both matters were concurrently

pending.

      Plaintiff relies on Alpha Beauty v. Winn-Dixie Stores, 425 N.J. Super. 94,

101 (App. Div. 2012), in support of its argument that the present action was

pending at the same time as the Engineered Devices Litigation, and therefore

not "successive" for purposes of Rule 4:5-1(b)(2). In Alpha Beauty, the court

provided an example as to what constitutes a successive action:

            The most obvious example of this would be an action
            where A sues B for personal injury damages, and then,
            later, after A v. B is concluded, A brings a claim against
            C for having caused the same injuries. A v. C would be
            a "successive action" within the intendment of the Rule
            and, in certain circumstances, the Rule authorizes
            dismissal of the successive suit against C.

            [425 N.J. Super at 101.]

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                                        26
       The present facts sufficiently mirror the above hypothetical posited in

Alpha Beauty. The motion judge found that, on January 25, 2017, an Order of

Final Judgment was entered in the Engineered Devices Litigation against

DiGregorio on plaintiff's crossclaim in the amount of $681,506. It was not until

March 24, 2017, that plaintiff filed its complaint in the matter under review.

Despite plaintiff's filing of an amended certification on April 5, 2017, January

25, 2017 marks the date where any further litigation would be considered

successive, as this is the date when the court entered judgment. Accordingly,

we discern no abuse of discretion in the judge's finding that the present matter

constitutes a successive action.

       Furthermore, the record clearly supports the motion judge's finding that

plaintiff did not comply with Rule 4:5-1(b)(2). As noted, parties to an action

are "obligated to reveal the existence of any non-party who should be joined or

might have 'potential liability to any party on the basis of the same transactional

facts.'"   Kent Motor Cars, Inc., 207 N.J. at 444 (quoting R. 4:5-1(b)(2)).

Furthermore, a party has a continuing obligation to identify potentially liable

parties throughout the course of the litigation. R. 4:5-1(b)(2). This requirement

is meant to provide notice to all potentially liable parties, and intends to provide

for a "reduction of delay, fairness to parties, and the need for complete and final

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                                        27
disposition through the avoidance of 'piecemeal decisions.'" 700 Highway 33

LLC, 421 N.J. Super. at 235 (quoting Cogdell v. Hosp. Ctr. at Orange, 116 N.J.

7, 15 (1989)).

      In the deposition of plaintiff's principal, Moshe Winer, he testified that as

early as May 2015, plaintiff was aware that inspections performed by defendant

JSC were inadequate. However, plaintiff did not list any defendant in the matter

under review in its Rule 4:5-1(b)(2) certifications in the Engineered Devices

Litigation.   Similarly, when plaintiff filed its third-party complaint in the

Engineered Devices Litigation, plaintiff did not disclose defendants as

potentially liable parties.

      Despite plaintiff's contention that it complied with Rule 4:5-1(b)(2) by

identifying the existence of the Engineered Devices Litigation in the present

action, this does not negate the fact that plaintiff failed to identify defendants in

the Engineered Devices Litigation, at which time plaintiff knew defendants were

potentially liable. Therefore, we discern no abuse of discretion in the motion

judge's determination that plaintiff did not comply with Rule 4:5-1(b)(2).

      We now turn to plaintiff's contention that the motion judge "erred by

failing to consider the reason for delay in bringing this litigation" and that he

instead "simply conflated engaging in piecemeal litigation with inexcusable

                                                                               A-1370-20
                                        28
conduct." In the judge's written decision granting defendants' motion to dismiss,

he stated that "[d]efendants were clearly prejudiced and deprived of vital

discovery, which [p]laintiff had an affirmative obligation to identify to the

[d]efendants including as to potentially liable parties in the Engineered Devices

Litigation, but inexcusably failed to do so." Moreover, in the judge's written

decision denying plaintiff's motion for reconsideration, he wrote, " It was clear

that this [c]ourt found the [p]laintiff's piecemeal litigation inexcusable as the

[c]ourt specifically stated such in its written opinion."

      Here, plaintiff submits that it delayed this action so that plaintiff could

receive a certification of occupancy and ultimately complete the project before

defendants could sabotage it. Although carefully elucidating his reasons as to

why he found that defendants would be substantially prejudiced, the motion

judge did not set forth his specific findings as to why plaintiff's conduct was

inexcusable.

      Nevertheless, we do not find this omission constitutes an abuse of

discretion. The judge, in his otherwise comprehensive written opinion, looked

to the record evidence before him, heard oral argument, and concluded that

plaintiff's noncompliance was inexcusable. Significantly, during oral argument

held on November 12, 2020, plaintiff's counsel explained,

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                                       29
            And our concerns were that the design professionals
            would stand in the way of my client getting those
            (indiscernible) for this project. Our concerns were
            borne out because . . . when we did serve the complaint,
            the first thing that [defendant] did . . . was pick up the
            phone and leave a voicemail for Bryan Sullivan . . . .
            He called Mr. Sullivan, and he left a profanity-laced
            voicemail promising to, as he said, f**k with the job.
            Use all of his ability and all of his political power in the
            North Bergen Building Department to screw up our job.

Thus, it is clear that the motion judge was well aware of plaintiff's excuse, and

found it inadequate under the circumstances, particularly in light of the

substantial prejudice suffered by defendants.

      As to the substance of plaintiff's excuse, the motion judge did not abuse

his discretion in finding that it fell short of the mark. Plaintiff's reason for

delaying suit was a tactical strategy based on its claimed fear that defendants

would retaliate. Plaintiff's fears were based on nothing more than a 2017

correspondence with defendant Roncati over issues regarding payment for

Roncati's services, where Roncati wrote, "If I were you[,] I would be here

tomorrow morning to discuss the billing. Your project still hangs in the balance

and you seem to have lost perspective on who your friends are and who has

always been there to help." This payment dispute, accompanied by what can be

viewed as hard-bargaining tactics, hardly renders plaintiff's noncompliance with

Rule 4:5-1(b)(2) excusable.

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                                       30
      Plaintiff next contends that the motion judge erred in finding that

plaintiff's failure to comply with Rule 4:5-1(b)(2) resulted in substantial

prejudice to defendants. We disagree.

      Indeed, if "the right of the undisclosed party to defend the successive

action has been substantially prejudiced by not having been identified in the

prior action," sanctions are appropriate.      R. 4:5-1(b)(2).    In considering

substantial prejudice, courts look to whether the party's "ability to mount a

defense . . . [is] unfairly hampered." Hobart Bros. Co., 354 N.J. Super. 229,

243. Courts have said that "[s]ubstantial prejudice in th[e] context [of Rule 4:5–

1(b)(2)] means substantial prejudice in maintaining one's defense. Generally,

that implies the loss of witnesses, the loss of evidence, fading memories, and the

like." Mitchell v. Procini, 331 N.J. Super. 445, 454 (App. Div. 2000) (citation

omitted); see also Kent Motor Cars, 207 N.J. at 446.

      First, defendants were deprived of an opportunity to examine and

investigate the worksite defects. Before the project had been fully remediated,

plaintiff initiated this action by filing the complaint on March 24, 2017.

However, plaintiff did not serve process until August 22, 2017, after the

certificate of occupancy was issued, and, as such, defendants were unaware of

the claims pending against them until such time. Therefore, defendants had no

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                                       31
knowledge of plaintiff's allegations against them until after remediation efforts

concluded.

      Although defendants were still involved in the project throughout the

remediation period, they lacked notice that they would be subject to claims

regarding defective construction. Because of this, defendants made no attempt

to collect evidence, investigate and evaluate the claimed defects, or do anything

for purposes of mounting a defense. Had plaintiffs notified defendants of the

suit in accordance with Rule 4:5-1(b)(2), they would have been able to

adequately prepare a defense.

      Second, the trial judge properly found that defendants were also depr ived

of an opportunity to "preserve and collect evidence by a key witness, Bryan

Sullivan." Sullivan was responsible for day-to-day project management and was

most knowledgeable about the defects.       Sullivan had first-hand knowledge

regarding the defects, discovered the defective conditions, and coordinated and

supervised the remediation efforts. As a key witness, Sullivan would have been

available during the Engineered Devices Litigation, however, he passed away

on March 5, 2018. Plaintiff did not identify him until May 17, 2018, and

therefore defendants had no opportunity to obtain testimony from Sullivan

regarding his first-hand observations and opinions.

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                                      32
      In addition, the record suggests that Sullivan did not prepare a formal

report, and that his observations were only recorded in notes and pictures. Such

observations were relied upon by plaintiff and plaintiff's expert , as they relied

on Sullivan's notes to identify the defects, the remedial work, and calculation of

damages. Moreover, plaintiff's experts relied on Sullivan's identification of

defects in support of their opinions as to defects attributable to defendants. As

noted by the judge, Sullivan's unavailability directly impacts defendants' ability

to mount a defense in response to allegations based on Sullivan's notes.

      In sum, the motion judge acted well within his discretion in finding that

defendants would be substantially prejudiced by the absence of a key witness,

where the loss of vital discovery would impair defendants' ability to mount a

defense.

      We next address plaintiff's argument that the trial court's failure to apply

a lesser sanction constitutes an abuse of discretion. This argument lacks merit.

      "Since dismissal with prejudice is the ultimate sanction, it will normally

be ordered only when no lesser sanction will suffice to erase the prejudice

suffered by the non-delinquent party." Abtrax Pharma., Inc. v. Elkins-Sinn, Inc.,

139 N.J. 499, 514 (1995). As it relates to the entire controversy doctrine, "in

the limited circumstances where a lesser sanction is not sufficient to remedy the

                                                                            A-1370-20
                                       33
problem caused by an inexcusable delay in providing the required notice,

thereby resulting in substantial prejudice to the non-disclosed party's ability to

mount an adequate defense[,]" dismissal with prejudice is a viable option.

Mitchell, 331 N.J. Super at 453-54.

      After finding that plaintiff's noncompliance with Rule 4:5-1(b)(2) was

inexcusable and resulted in substantial prejudice to defendants, the motion judge

properly found that no lesser sanction would suffice. The judge ultimately found

that, since the prejudice cannot be corrected, dismissal is warranted.

Defendants' inability to examine crucial evidence and the key witness, Sullivan,

cannot be undone; for these reasons, dismissal was warranted, and we find no

abuse of discretion.

                                       B.

      Plaintiff contends that the motion judge erred in finding that the

DiGregorio Judgment, from the Engineered Devices Litigation, precludes

recovery from defendants in the present matter. Plaintiff disputes that this would

result in double recovery, and argues that damages that made up the DiGregorio

judgment do not overlap with the damages sought in the present action.

      The motion judge did not err in finding that the complaint should be

dismissed to prevent double recovery. It is undisputed that at least some of the

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                                       34
damages would overlap; the DiGregorio judgment was for fraudulent payment

requisitions, while plaintiff in the matter under review alleged that defendants

Revolution, Roncati, and Architectura "improperly certified various contractor

payment applications certifying that the general contractor performed work that

it had not done." Therefore, the damages asserted in the present action are

duplicative of damages for which plaintiff obtained in the prior litigation.

Because the entire controversy doctrine is designed to prevent this from

occurring, the judge did not abuse his discretion in finding that dismissal is

warranted to prevent double recovery.

      Lastly, plaintiff argues that the trial court erred in failing to consider the

materials supplied with the motion for reconsideration. This argument also fails.

      Motions     for   reconsideration      are   governed   by    Rule    4:49-2.

"Reconsideration is a matter to be exercised in the trial court's sound discretion."

Capital Fin. Co. of Del. Valley, Inc. v. Asterbadi, 398 N.J. Super. 299, 310 (App.

Div. 2008). Reconsideration should be employed only "for those cases which

fall into that narrow corridor in which either 1) the [c]ourt has expressed its

decision based upon a palpably incorrect or irrational basis, or 2) it is obvious

that the [c]ourt either did not consider, or failed to appreciate the significance

of probative, competent evidence." Cummings v. Bahr, 295 N.J. Super. 374,

                                                                              A-1370-20
                                        35
384 (App. Div. 1996) (quoting D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch.

Div. 1990)).

       "A motion for reconsideration is designed to seek review of an order based

on the evidence before the court on the initial motion, [Rule] 1:7-4, not to serve

as a vehicle to introduce new evidence in order to cure an inadequacy in the

motion record." Asterbadi, 398 N.J. Super. at 310 (citing Cummings, 295 N.J.

Super. at 384). "Reconsideration cannot be used to expand the record and

reargue a motion." Ibid. "[T]he motion is properly denied if based on unraised

facts known to the movant prior to entry of judgment."               Pressler &

Verniero, Current N.J. Court Rules, cmt. 2 on R. 4:49-2 (2022) (citing Palombi

v. Palombi, 414 N.J. Super. 274, 289 (App. Div. 2010); and Del Vecchio v.

Hemberger, 388 N.J. Super. 179, 188-89 (App. Div. 2006)). However, if the

new evidence "dovetail[s] and amplifie[s] the evidence already in the record," it

should be considered. Capital Fin. Co. of Del. Valley, Inc., 398 N.J. Super. at

311.

       Here, the motion judge properly exercised his discretion in finding that

additional documents and arguments regarding plaintiff's inexcusable

noncompliance should not be considered on reconsideration.            All of the

documents were readily available to plaintiff when defendants filed their

                                                                            A-1370-20
                                       36
motions to dismiss. Because the documents were not newly discovered evidence

that was previously unavailable, the judge's refusal to consider such evidence

was not clearly erroneous and therefore should not be disturbed.

      Affirmed.

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