Daniel J. Sysol v. William G. Sanchez

• Court: New Jersey Superior Court Appellate Division
• Decided: October 31, 2025
• Docket: A-3427-23
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-3427-23

DANIEL J. SYSOL and YAXY SYSOL,

Plaintiff-Appellant,

v.

WILLIAM G. SANCHEZ,

Defendant-Respondent. _________________________

Argued October 7, 2025 – Decided October 31, 2025

Before Judges Sumners and Susswein.

On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-2892-23.

Eric P. LeBoeuf (LeBoeuf Law, LLC) argued the cause for appellant.

Neil A. Tortora argued the cause for respondent (Morrison Mahoney LLP, attorneys; Neil A. Tortora, on the brief).

PER CURIAM This appeal arises from a civil action in which plaintiffs Daniel J. Sysol

and Yaxy Sysol claim their former attorney, defendant William G. Sanchez,

committed malpractice when he represented them in the 2015 sale of their house.

That transaction led the buyers of the property to bring a fraud action (the

"Chancery matter") against plaintiffs in December 2017. The Chancery matter

was settled in March 2023 for $12,500. Following the settlement, plaintiffs

initiated the present suit against Sanchez, claiming breach of contract, legal

malpractice, and severe emotional and traumatic distress. Plaintiffs appeal the

trial court's June 24, 2024 order dismissing their complaint with prejudice. The

trial court held that plaintiffs' claims were barred by the applicable six-year

statute of limitations. The court also observed that plaintiffs should have

impleaded defendant into the Chancery matter and brought their claims against

him in that forum under the entire controversy doctrine (ECD).

After reviewing the record in light of the governing legal principles, we

conclude that the ECD does not provide an independent basis to dismiss

plaintiffs' complaint with prejudice. With respect to the trial court's statute of

limitations ruling, we reverse and remand for the court to consider plaintiffs'

contention that the statute of limitations was equitably tolled when defendant's

A-3427-23 2 insurance carrier instructed plaintiffs' counsel to wait until plaintiffs incurred

actual damages in the Chancery matter before initiating a malpractice action.

I.

We discern the following procedural history and pertinent facts from the

record. In 2015, plaintiffs retained defendant to represent them in the sale of

their residential property to buyers Israel and Nesia Lichtenstein. Before

closing, plaintiffs informed the Lichtensteins that the property included a shed

that plaintiffs had constructed without permits. The Lichtensteins agreed to

purchase the property despite the lack of permits, and plaintiffs asked their

attorney, defendant, to memorialize this agreement so that plaintiffs would be

protected from liability after closing. Defendant told plaintiffs that he spoke to

the Lichtensteins' attorney, Gerald J. Klein, and the two agreed the Lichtensteins

would purchase the property without acquiring back permits. However, on

August 26, 2015, defendant executed an addendum to the contract of sale,

prepared by Klein, which stated, "Seller represents that . . . Seller will close out

all permits or violations before Closing."

On November 25, 2015, plaintiffs and the Lichtensteins closed on the

property. Defendant advised plaintiffs that the purported agreement between

A-3427-23 3 defendant and Klein—that the Lichtensteins agreed to purchase the property

without back permits—was documented in the closing file notes.

After the closing, the Township notified the Lichtensteins that the shed on

the property was constructed without required permits and in violation of the

building code. Upon further investigation, the Lichtensteins also discovered that

the shed was located five feet onto county property. On February 23, 2017, the

Lichtensteins' new attorney, Harvey L. York, sent a demand letter to plaintiffs

describing these defects and requesting compensation of approximately

$95,000. The letter alleged that plaintiffs and defendant had made fraudulent

representations in the closing documents, stating:

At the time of closing, you executed various documents. Those documents contained attorney representations that the building had been constructed in accordance with the applicable Ordinances and Statutes and was in fact located on the property which was being conveyed to the Lichtenstein[s]. In reviewing all of the applicable information, it is clear that you deliberately defrauded our clients. At the time of the closing you knew that no building permits had been obtained and that the building was improperly located. . . . The purpose of this letter is to place you on notice that our clients demand payment of their damages. . . . We suggest you contact an attorney for immediate representation.

Plaintiffs forwarded the demand letter to defendant. After speaking with

the Lichtensteins' attorney, defendant informed plaintiffs that they had indeed

A-3427-23 4 represented to the Lichtensteins that the shed was within the property lines, but

that in fact the shed was on county property. 1 In response, plaintiffs asked

defendant "how . . . he protected us during this transaction," and defendant

replied that he did not know the shed was on county property and that the

plaintiffs may have some exposure to civil litigation. Defendant advised

plaintiffs to retain separate counsel with regard to the post-sale dispute between

plaintiffs and the Lichtensteins.

In early March 2017, plaintiffs retained a new attorney, Peter T. Seems,

to represent them in their dispute with the Lichtensteins. On March 21, 2017,

defendant sent Seems a complete copy of his file for the property sale to the

Lichtensteins.

On December 8, 2017, the Lichtensteins filed a complaint against

plaintiffs (the Chancery matter) based on allegedly fraudulent

misrepresentations about the property. On March 12, 2018, plaintiffs' counsel

in the Chancery matter, Gregory Heizler, informed defendant that his "tortious

action/inaction . . . has been identified as a substantial contributing factor in

[plaintiffs'] loss" and that he must notify his liability insurer. Defendant did not

1 The addendum to the contract of sale that defendant executed on August 26, 2015 states, "Seller represents that, to the best of Seller's knowledge . . . All improvements to the property fall within the Property's boundary lines." A-3427-23 5 respond, and on June 28, 2018, Heizler informed defendant that if he did not

respond within ten days, plaintiffs would add an affirmative malpractice claim

against him in the Chancery matter. Heizler then contacted defendant's

malpractice insurance carrier, Allianz, to file a claim. According to plaintiffs,

Allianz informed Heizler that it "could not continue with" such a claim until

plaintiffs sustained damages in the Chancery matter. Plaintiffs never impleaded

defendant into the Chancery matter. On March 3, 2023, plaintiffs and the

Lichtensteins settled the Chancery matter, with plaintiffs agreeing to pay the

Lichtensteins $12,500.

On December 20, 2023, plaintiffs filed the present complaint against

defendant, alleging breach of contract, legal malpractice, and "severe emotional

and traumatic distress" based on defendant's failure to adequately investigate

and document the permitting and property boundary issues. Specifically,

plaintiffs alleged that defendant "failed to formally record or document any

information communicated to him by [plaintiffs] to the buyer's attorney or make

any official record, legal changes, modifications or provide any legal safeguards

as instructed by [plaintiffs]."

On March 13, 2024, defendant filed a motion to dismiss for failure to state

a claim pursuant to Rule 4:6-2(e), arguing that plaintiffs' claims were barred by

A-3427-23 6 the ECD as well as the six-year statute of limitations for legal malpractice

actions. On May 5, 2024, plaintiffs filed an opposition to defendant's motion to

dismiss. Oral argument was held on May 28, 2024.

On June 24, 2024, the court granted defendant's motion and dismissed the

complaint with prejudice. The court made factual findings that "[o]n March 9,

[2017], [defendant] received an email that [Mr. Seems] would be representing

[plaintiffs]" and "[o]n March 21, 2017 . . . [defendant] sent his file to Mr.

Seems." The court then determined that plaintiffs' claims accrued by March 21,

2017, at the latest, and held that plaintiffs' December 20, 2023 malpractice

action was therefore barred by the six-year statute of limitations. 2

This appeal followed. Plaintiffs contend that the trial court erred: (1) in

dismissing the complaint with prejudice because the complaint set forth

sufficient allegations to support a claim; (2) by dismissing the complaint

pursuant to the statute of limitations because the statute was equitably tolled;

and (3) by dismissing plaintiffs' complaint pursuant to the ECD.

2 The court's order also states: "Plaintiff[s] did not join Defendant in the Chancery matter" but does not clearly indicate whether this was an additional independent basis for dismissing the malpractice action with prejudice. A-3427-23 7 II.

We first address the threshold question of whether plaintiffs' complaint

was properly dismissed because it was filed after the applicable statute of

limitations had lapsed. Legal malpractice actions, which derive from the tort of

negligence, are subject to a six-year statute of limitations. N.J.S.A. 2A:14-1;

Grunwald v. Bronkesh, 131 N.J. 483, 492 (1993). Ordinarily, "a legal-

malpractice action accrues when an attorney's breach of professional duty

proximately causes a plaintiff's damages." Grunwald, 131 N.J. at 492.

However, under the "discovery rule," a legal malpractice action will not accrue

if the plaintiff "does not and cannot know the facts that constitute an actionable

claim." Ibid. Instead, in legal malpractice cases, "the statute of limitations

begins to run only when the client suffers actual damage and discovers, or

through the use of reasonable diligence should discover, the facts essential to

the malpractice claim." Id. at 494.

The trial court determined that plaintiffs' cause of action accrued in March

2017 and was therefore barred by the time the complaint was filed in December

2023. More specifically, the court held that plaintiffs suffered "actual damage"

when they had to hire a new attorney in March 2017 to represent them in their

dispute with the Lichtensteins. The court further found that plaintiffs discovered

A-3427-23 8 or should have discovered the facts essential to their claim, at the latest, when

defendant sent his file to Seems in March 2017.

We agree with the trial court that the accrual date occurred more than six

years before the malpractice suit was initiated. We note that the accrual date of

a legal malpractice claim "is not necessarily the date on which the client actually

knew the facts on which the malpractice claim is based; instead, that date 'is set

in motion when the essential facts of the malpractice claim are reasonably

discoverable.'" Dimitrakopoulos v. Borrus, Goldin, Foley, Vignuolo, Hyman &

Stahl, P.C., 237 N.J. 91, 116 (quoting Vastano v. Algeier, 178 N.J. 230, 242

(2003)); see also Grunwald, 131 N.J. at 493 ("The limitations period begins to

run when a plaintiff knows or should know the facts underlying [the elements of

a legal malpractice claim,] not necessarily when a plaintiff learns the legal effect

of those facts.").

In Vastano, the plaintiffs alleged that their former attorney committed

malpractice by failing to communicate a highly favorable settlement offer to

them during the damages trial. 178 N.J. at 234. The plaintiffs first learned of

the offer after they (and their new attorneys) received possession of the former

attorney's case file, which included an appellate brief that mentioned the

uncommunicated offer in a footnote. Ibid. Our Supreme Court held that, once

A-3427-23 9 the plaintiffs received the former attorney's file, they had sufficient information

to discover the basis of their malpractice claim:

We conclude that when plaintiffs took their file they possessed all the information necessary to reveal malpractice without resort to the interpretative assistance of an expert. . . . One would have expected plaintiffs or their new attorneys to have read the appellate briefs and to have discovered in the footnote the unconveyed settlement offer. Finding a reference to the settlement offer did not require sifting through the file. . . . There may be cases in which it would be unfair to conclude that the contents of an extraordinarily large file were reasonably discoverable on the day the client took possession of the file. This is not such a case.

[Id. at 242.]

Here, plaintiffs do not dispute that their new attorney received defendant's

entire file in March 2017. Viewing the record in the light most favorable to

plaintiffs, the evidence of defendant's alleged malpractice should have been

reasonably discernible in the file Seems received.

Furthermore, there is additional undisputed evidence that plaintiffs knew

or should have known the facts underlying their malpractice claim by the time

Seems received the file, including (1) the February 2017 letter from the

Lichtensteins' attorney, stating that the closing documents contained fraudulent

"attorney representations," and (2) defendant's statement to plaintiff, a few days

A-3427-23 10 later, that he (defendant) "did not know that the shed was on county property so

[plaintiffs] may have some exposure to civil litigation." It is thus evident that

plaintiffs had sufficient information to discover the basis of their malpractice

claim, at the latest, once Seems received defendant's file.

Although we agree with the trial court's findings of fact and conclusions

of law with respect to the accrual date, the court's written opinion does not

address the concept of equitable tolling. In fairness, our review of the record

shows that none of the pleadings use the phrase "equitable tolling." However,

in their opposition to defendant's motion to dismiss, plaintiffs made factual

allegations that form the crux of their equitable tolling argument on appeal.

Specifically, they alleged that defendant's insurer, Allianz, told plaintiffs'

attorney that Allianz "could not continue with a malpractice insurance claim

until [plaintiffs] sustained damages . . . from a lawsuit." Plaintiffs further argue

that the statute of limitations was equitably tolled because Allianz "actively

misled" plaintiffs into believing that their malpractice action would not accrue

until plaintiffs faced damages in the Chancery matter.

Equitable tolling is "traditionally reserved for limited occasions. These

include: '(1) [if] the defendant has actively misled the plaintiff [or] (2) if the

plaintiff has "in some extraordinary way" been prevented from asserting his

A-3427-23 11 rights.'" F.H.U. v. A.C.U., 427 N.J. Super. 354, 379 (App. Div. 2012) (internal

citations omitted). Typically, the doctrine is applied "where the complainant

has been induced or tricked by his adversary's misconduct" into missing the

filing deadline. Villalobos v. Fava, 342 N.J. Super. 38, 50 (App. Div. 2001)

(quoting Dunn v. Borough of Mountainside, 301 N.J. Super. 262, 280 (App Div.

1997), certif. denied,. 153 N.J. 402 (1998)).

In Barron v. Gersten, we underscored the narrow scope and stringent

standards of the equitable tolling doctrine, holding:

A statute of limitations may be equitably tolled under very limited circumstances: "(1) [if] the defendant has actively misled the plaintiff, (2) if the plaintiff has 'in some extraordinary way' been prevented from asserting his [or her] rights, or (3) if the plaintiff has timely asserted his [or her] rights mistakenly in the wrong forum." F.H.U. v. A.C.U., 427 N.J. Super. 354, 379 (App. Div. 2012) (quoting Kocian v. Getty Refin. & Mktg. Co., 707 F.2d 748, 753 (3d Cir. 1983)). "Absent a showing of intentional inducement or trickery by a defendant, [equitable tolling] . . . should be applied sparingly and only in the rare situation where it is demanded by sound legal principles and in the interest of justice." Binder v. Price Waterhouse & Co., L.L.P., 393 N.J. Super. 304, 313 (App. Div. 2007) (quoting Freeman v. State, 347 N.J. Super. 11, 31 (App. Div. 2002)). "[E]quitable tolling requires plaintiffs to 'diligently pursue their claims' because although it 'affords relief from inflexible, harsh or unfair application of a statute of limitations,' [it] does not excuse claimants from exercising the reasonable insight

A-3427-23 12 and diligence required to pursue their claims." Ibid. (quoting Freeman, 347 N.J. Super. at 31-32).

[472 N.J. Super. 572, 577 (App. Div. 2022) (alternations in original).]

Here, the trial court made no findings of fact or conclusions of law as to

whether plaintiffs have demonstrated the sort of misconduct or extraordinary

circumstances that would equitably toll the statute of limitations. We decline to

exercise original jurisdiction on this fact-sensitive issue, see Rivera v. Union

Prosecutor's Ofc., 250 N.J. 124, 146 (2022) (original jurisdiction should be

exercised "sparingly . . . and is generally used when the record is adequately

developed and no further fact-finding is needed") (internal citations omitted),

and leave for the trial court to make findings in the first instance. To aid the

trial court, we direct the parties to provide the court with their appellate

submissions. We leave to the court's discretion whether to require supplemental

submissions or whether to convene a hearing to address any disputed facts

pertinent to whether the equitable tolling doctrine applies in this case. If the

court determines that the statute of limitations was equitably tolled, it sh all

vacate the order dismissing plaintiffs' complaint with prejudice.

A-3427-23 13 III.

We next address whether the ECD provides an independent basis upon

which to dismiss plaintiffs' complaint with prejudice. In that event, a remand

for the trial court to consider plaintiffs' equitable tolling argument would not be

necessary, since the dismissal of the complaint with prejudice would be required

even if the statute of limitations were tolled. As we have noted, the trial court's

opinion does not clearly indicate whether the ECD provided alternate grounds

to dismiss the complaint. See note 2. In any event, the law is clear that the

doctrine in its current formulation does not apply here.

New Jersey's ECD is codified in Rule 4:30A. There is a history to the

Court Rule that bears on this appeal. The ECD is a preclusive doctrine intended

to encourage comprehensive and conclusive litigation determinations, avoid

fragmentation of litigation, and promote fairness and judicial efficiency. See

Pressler & Verniero, Current N.J. Court Rules, cmt. 1 on R. 4:30A (2026). "The

doctrine was conceived as a claim-joinder mandate, requiring all parties in an

action to raise in that action all transactionally related claims each had against

any other whether assertable by complaint, counterclaim, or cross-claim." Ibid.

(citations omitted). In Codgell v. Hospital Center at Orange, our Supreme Court

extended the doctrine to include mandatory party joinder and not just claim

A-3427-23 14 joinder involving the parties already in the case. 116 N.J. 7, 26 (1989). That

extension to non-parties, however, "created both practical and conceptual

difficulties in implementation and too many perceived instances of injustice."

Pressler & Verniero, cmt. 1 on 4:30A. Accordingly, 1998 amendments to Rule

4:30A—which remain in effect today—eliminated mandatory party joinder

under the ECD except in special situations not applicable here. Ibid.; see also

C.P. v. Governing Body of Jehovah's Witnesses, 477 N.J. Super. 129, 140 (App.

Div. 2023) (according pipeline retroactivity to the 1998 amendments). Thus,

defendant's reliance on Cogdell and related cases is misplaced because those

cases were abrogated by the 1998 amendments.

Simply stated, "[e]xcept in special situations involving both inexcusable

conduct and substantial prejudice to the non-party resulting from omission from

the first suit, successive actions against a person not a party to the first action

are not precluded." Pressler & Verniero, cmt. 1 on 4:30A. Further, if a

defendant does not provide "any specific instances of prejudice," they fail to

show "substantial prejudice" under the exception. C.P., 477 N.J. Super. at 142.

Here, defendant has not asserted any specific claim that he would be

substantially prejudiced by having to defend a malpractice claim now, as

opposed to during the Chancery matter. Because he has not satisfied that

A-3427-23 15 prerequisite to invocation of the ECD, dismissal of plaintiffs' complaint against

him pursuant to the doctrine is neither required nor appropriate.

Reversed and remanded for further proceedings consistent with this

opinion. We do not retain jurisdiction.

A-3427-23 16