NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-3587-22
WILLIAM J. FOCAZIO, M.D.,
Plaintiff-Appellant, APPROVED FOR PUBLICATION February 24, 2025 and APPELLATE DIVISION
ARTHUR ST. REALTY, LLC, and ENDO SURGICAL CENTER OF EAST BRUNSWICK, LLC,
Plaintiffs,
v.
JOSEPH S. ABOYOUN, ESQ., and ABOYOUN & HELLER, LLC,
Defendants-Respondents,
and
NAGEL RICE, LLP, RANDEE MATLOFF, ESQ., and BRUCE NAGEL, ESQ.,
Defendants. _____________________________
Argued January 30, 2025 – Decided February 24, 2025
Before Judges Natali, Walcott-Henderson, and Vinci. On appeal from the Superior Court of New Jersey, Law Division, Passaic County, Docket No. L-2643-16.
Kenneth S. Thyne argued the cause for appellant (Simon Law Group, LLC, attorneys; Kenneth S. Thyne, of counsel and on the briefs).
Adam J. Adrignolo argued the cause for respondents Joseph S. Aboyoun and Aboyoun & Heller, LLC (McElroy, Deutsch, Mulvaney & Carpenter, attorneys; Adam J. Adrignolo, of counsel; Daniel A. Malet, on the brief).
The opinion of the court was delivered by
VINCI, J.A.D.
Plaintiff William J. Focazio, M.D. appeals from the February 23, 2023
order granting defendants Joseph S. Aboyoun and Aboyoun & Heller, LLC's
motion to dismiss for lack of standing and the June 27, 2023 order denying
plaintiff's motions in limine without prejudice. We reverse the order granting
defendants' motion to dismiss and affirm the order denying plaintiff's in limine
motions.
I.
This legal malpractice action arises out of defendants' representation of
plaintiff in the matter captioned Focazio v. Northeast Modular Homes, Inc. &
George A. Tsairis Architects, P.C., No. PAS-L-2590-11 (the Tsairis lawsuit).
A-3587-22 2 We summarize the facts underlying the Tsairis lawsuit to provide context for
our decision in this case.
In December 2007, plaintiff purchased a residential property in Wayne for
approximately $1,600,000. He initially intended to renovate the home located
on the property but later decided to raze the structure and construct a new
modular home.
Plaintiff hired George A. Tsairis Architects, P.C. (Tsairis) and its
affiliated construction company, Northeast Modular Homes, Inc., to design and
build the new home. He retained Aboyoun and his law firm, Aboyoun & Heller,
LLC, to represent him in his contract negotiations with Tsairis.
Under his contract with Tsairis, plaintiff agreed to pay Tsairis
approximately $2,300,000 for the project. He paid Tsairis deposits totaling
$969,000. Approximately $400,000 was intended to be set aside by Tsairis to
purchase a modular home. Tsairis allegedly paid the modular home
manufacturer only $5,000 of that amount and retained the rest.
As required by the contract, Tsairis conducted a zoning study and opined
the proposed construction would comply with local land development
ordinances and no variances or waivers were needed. However, after Tsairis
razed the existing home, the municipality stopped all work on the project
A-3587-22 3 because a required environmental protection waiver had not been obtained. The
entire project was to be completed within 300 days of the "date of
commencement," which was defined as the date on which all necessary permits
were obtained. Because the permits were not obtained, work never
"commenced" under the terms of the contract.
Aboyoun advised plaintiff he could cancel the contract because of the
delay, but he would have to sue Tsairis to recoup the deposits he made. Aboyoun
advised Tsairis plaintiff was canceling the contract and requested Tsairis return
all amounts previously paid. Tsairis refused and blamed the delay on the project
engineer plaintiff hired. Aboyoun began preparing for litigation with Tsairis
and retained another attorney to help him prepare a complaint.
Before the complaint was finalized, plaintiff retained defendants Nagel
Rice LLP, Randee Matloff, Esq., and Bruce Nagel, Esq. (collectively, Nagel) to
represent him in the lawsuit against Tsairis. Aboyoun remained involved on
plaintiff's behalf. Nagel prepared a new complaint, and Aboyoun approved it
for filing. Plaintiff sought damages against Tsairis for breach of contract, breach
of good faith and fair dealing, unjust enrichment, conversion, and consumer
fraud.
A-3587-22 4 In early 2012, plaintiff hired another attorney, George Abdy, Esq., and his
firm, Abdy & Kane, P.C., to advise him on the litigation. Aboyoun and Nagel
also remained as plaintiff's attorneys. By March 2013, plaintiff was in arrears
in paying Nagel. In May 2013, the court granted Nagel's motion to be relieved
as counsel, and Abdy and Matthew Cavaliere, Esq. of Cavaliere & Cavaliere,
P.A., became counsel of record.
Abdy advised plaintiff that under the terms of the construction contract,
the date of commencement of work did not begin until the final municipal
permits and approvals were obtained, and the contract had been prematurely
terminated. Abdy and Cavaliere advised plaintiff to resolve the matter through
binding arbitration. In December 2016, the arbitrator ruled in favor of Tsairis,
finding plaintiff improperly terminated the contract and ordered him to pay
Tsairis $164,470, plus interest and counsel fees.
In July 2016, before the completion of arbitration, plaintiff retained a new
attorney, who filed this legal malpractice action against Aboyoun and Nagel.1
Among other things, plaintiff alleged Aboyoun failed to advise him of the
pitfalls present in the contracts that required him to pay large deposits without
1 Plaintiff's claims against Nagel were dismissed voluntarily prior to the entry of the order granting defendants' motion to dismiss.
A-3587-22 5 any guarantees work would progress at a reasonable pace. He contended
Aboyoun should have included provisions in the agreements that would have
allowed him to reclaim his payments in the event the project was cancelled.
Plaintiff asserted Aboyoun incorrectly advised him he could cancel the contract
with Tsairis even though the necessary municipal approvals had not been
obtained. He sought damages exceeding $4,000,000.2
On October 19, 2017, plaintiff and Tsairis entered into a settlement
agreement (the Tsairis Agreement) whereby plaintiff agreed to pay Tsairis a
"Total Award" of $289,470 to satisfy the arbitration award. The Total Award
included the initial arbitration award of $164,470, plus interest and counsel fees
in the amount of $125,000.
The Tsairis Agreement included a payment schedule, and Tsairis agreed
"[a]bsent an event of [d]efault, [it would] forebear from any actions/efforts to
collect upon the . . . Total Award." The Tsairis Agreement included a
"Security/collateral" provision that provides:
Simultaneously with the execution . . . of the [Tsairis] Agreement, [plaintiff] shall deliver to [Tsairis] a Security Agreement . . . creating and otherwise
2 The court previously granted summary judgment for defendants after barring plaintiff's experts' reports as impermissible net opinions. We reversed and remanded for additional discovery and a N.J.R.E. 104 hearing. Focazio v. Aboyoun, No. A-1249-19 (App. Div. June 7, 2021). A-3587-22 6 granting [Tsairis] a security interest in any and all of [plaintiff's] right, title and interest, in and to all money, directly or indirectly, recovered (i.e., settlement funds, collections on judgment, etc.), net of [plaintiff's] attorneys['] fees and litigation costs incurred for that action ("Net Settlement"), in [this malpractice action] . . . , upon the terms and conditions set forth in said Security Agreement in the amount and to the extent necessary to fully pay and satisfy all sums due [Tsairis] by [plaintiff] under this agreement.
The same day, plaintiff and Tsairis executed a Pledge and Security
Agreement (the Security Agreement) as contemplated by the Tsairis Agreement.
It provides:
WHEREAS, [plaintiff] is indebted to [Tsairis] in . . . sum of . . . $289,470 . . . (the "Loan"), as evidenced by a certain Settlement Agreement of even date herewith, which is incorporated herein by reference . . . .
....
. . . [Plaintiff] and [Tsairis] hereby agree as follows:
1. Definitions. . . .
a. The term "Collateral" means:
I. Aboyoun. All of [plaintiff's] right, title and interest, in and to all money, directly or indirectly, recovered (i.e., settlement funds, collections on judgment, etc.), net of [plaintiff's] attorneys['] fees and litigation costs [i]ncurred for that action ("Net Settlement"), in . . . [this malpractice action] filed or about to be filed . . . , upon the terms and conditions set
A-3587-22 7 forth herein . . . ; upon the receipt of the Net Settlement by [plaintiff's] Law Firm . . . , so much of the Net Settlement necessary to pay-off and satisfy the Loan shall be forthwith paid to [Tsairis] by [plaintiff's] Law Firm;
b. The term "Liabilities" means any and all obligations and indebtedness of every kind and description of [plaintiff] owing to [Tsairis] under the Security Agreement . . . .
2. Collateral Pledge. [Plaintiff] hereby assigns, transfers and pledges to [Tsairis] and grants to [Tsairis] a continuing security interest in and lien on all of [plaintiff's] right, title and interest in and to the Collateral to secure the prompt payment, performance, satisfaction, and discharge of the Liabilities.
4. Collateral & Default. If [plaintiff] fails to make any payment to [Tsairis] in reduction of the Liabilities when due, [Tsairis] may seize, sell or otherwise dispose of any or all of the Collateral at any time and from time to time at public or private sale, upon issuance of prior written notice to [plaintiff], which, due to the nature of the Collateral and to the possibility of changes in value of the Collateral, [plaintiff] hereby acknowledges and agrees said notice to be sufficient, commercially reasonable, and proper, with or without advertisement of the sale, and may apply the proceeds of any such sale to the expenses of such sale, and/or to the Liabilities, in such order as [Tsairis] shall determine in its sole and absolute discretion.
A-3587-22 8 ....
10. Release of Collateral. Upon [p]ayment and satisfaction in full of all Liabilities . . . , [Tsairis] shall release the Collateral . . . .
On March 8, 2022, plaintiff entered into an Acknowledgement of Attorney
Charging Lien (the Law Firm Agreement) with Cavaliere & Cavaliere, P.A. and
Abdy & Kane, P.C. (the Law Firms) in connection with their work on the Tsairis
lawsuit. Plaintiff, defined in the agreement as "Client," agreed he "is indebted
to the [Law Firms] for legal fees arising from said representation . . . for legal
services rendered in that matter through August 2, 2017." He acknowledged the
Law Firms "asserted an attorney's charging lien . . . upon any and all Client
proceeds resulting from" this malpractice action.
Plaintiff "proposed that the [Law Firms] forebear from receiving and/or
collecting the balance of said legal fees due . . . until resolution of [this
malpractice action]." In exchange for their agreement to forebear, plaintiff
agreed he "irrevocably acknowledges the creation of and/or otherwise creates an
Attorney's Charging Lien in favor of the [Law Firms] and upon any and all of
the Client's proceeds resulting from [this malpractice action]." As an element
of damages in this case, plaintiff contends he owes the Law Firms $253,725.
A-3587-22 9 II.
Trial was scheduled for February 21, 2023. Plaintiff filed a motion in
limine to preclude evidence relating to his prior bankruptcies, including the
valuation of his practice in connection with the bankruptcies. Plaintiff also
sought to preclude evidence of a 2012 complaint filed against him by an
insurance company alleging insurance fraud. Defendants alleged that complaint
resulted in financial difficulty for plaintiff that was relevant to the construction
project underlying this case.3
On February 16, 2023, the court denied plaintiff's motion "without
prejudice pending testimony at trial."4 The court denied the motion to bar any
mention of the insurance fraud matter without prejudice because plaintiff did
not provide information sufficient to determine whether it should be excluded.
It also denied plaintiff's motion to exclude evidence of plaintiff's prior
bankruptcies without prejudice, finding "the bankruptcies may be relevant
evidence and . . . the [c]ourt will find whether they are at the time they are
3 Plaintiff also contends he orally moved to preclude evidence of the price of the home he subsequently purchased. The record on appeal does not include any evidence of that motion or the court's decision on the motion. We decline to consider arguments not properly raised on appeal. See Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234 (1973). 4 The court did not enter an order adjudicating the motions until June 27, 2023. A-3587-22 10 introduced" at trial. The court noted, "all of these rulings are without prejudice
subject to what happens during the course of trial . . . depending upon what
comes out of the witnesses' mouths . . . on the stand."
On February 21, 2023, defendants filed a three-page "application seeking
appropriate [relief] in light of plaintiff's impermissible assignment of his legal
malpractice claims." They argued the Security Agreement and the Law Firm
Agreement gave Tsairis and the Law Firms a pecuniary financial interest in the
result of the malpractice action and "[a]part from the legal impermissibility of
this assignment dynamic, such an arrangement places . . . [d]efendants in a
prejudiced stance in light of the certain bias of a known integral witness to this
litigation." They argued the "assignments are impermissible and as such,
[p]laintiff's action should be dismissed with prejudice." The court permitted
plaintiff to file a written response the following day. On February 22, the court
heard oral argument on defendants' application.
On February 23, the court entered an order granting "defendants' motion
to dismiss" supported by an oral opinion. The order provides "all claims by
[p]laintiff . . . are dismissed for lack of standing as [p]laintiff assigned his
interest in these matters to third parties." The court noted "tort claims cannot be
assigned prior to judgment," but "[t]he language of the agreements at issue does
A-3587-22 11 not indicate an assignment of any claims, but rather the assignment of future
proceeds for judgment." It found "plaintiff makes a distinction without a
difference between assigning a claim and pledging future proceeds."
The court continued:
While there may be a syntactical and practical difference between the two, New Jersey courts have yet to rule on such. While current case law does not . . . delineate a distinction, the agreement may not clearly state that the third parties have a right to sue in their own name upon [plaintiff's] claim. The effect of the language remains the same. In the present matter, [plaintiff] is merely seeking a judgment that is to be paid directly to the third parties and thus, [plaintiff] will receive the benefit of the judgment in name only. In effect, the third parties would be able to sue upon [plaintiff's] claim based on the fact that they seek to recover an amount now owed to them. Such an arrangement clearly affects [plaintiff's] standing under Rule 4:26-1, which provides that, "[e]very action may be prosecuted in the name of a real party in interest."
[Plaintiff's] stake in the present matter is essentially that of receiving a judgment to pay off his creditors, and the harm [plaintiff] will suffer in the event of an adverse decision is not one stemming from the alleged malpractice of defendants, but of not being able to pay his creditors. As a result, plaintiff's lack of standing as well as [plaintiff's] assignment of his claims, this [c]ourt must grant any motions to dismiss.
Immediately following the decision, the court discharged the jury.
A-3587-22 12 On appeal, plaintiff argues: (1) he was deprived of due process; (2) the
Security Agreement and the Law Firm Agreement do not constitute a
prejudgment assignment of a chose in action; and (3) the court erred by denying
his in limine motions.
III.
We review an order granting a motion to dismiss for lack of standing de
novo. Courier-Post Newspaper v. Cnty. of Camden, 413 N.J. Super. 372, 381
(App. Div. 2010). Generally, contract interpretation is subject to de novo
review. Kieffer v. Best Buy, 205 N.J. 213, 222 (2011). "Accordingly, we pay
no special deference to the trial court's interpretation and look at the contract
with fresh eyes." Id. at 223 (citing Manalapan Realty, LP v. Twp. Comm. of
Manalapan, 140 N.J. 366, 378 (1995)).
The court incorrectly determined plaintiff lacks standing because he
improperly assigned his interest in this malpractice action to third parties. We
reach this conclusion for two reasons. First, the court mistakenly found plaintiff
assigned the entirety of his right of recovery in this action and "will receive the
benefit of the judgment in name only." Second, the court incorrectly found an
assignment of a future monetary recovery by an injured plaintiff in tort litigation
is tantamount to an impermissible assignment of a tort claim to a third party.
A-3587-22 13 A.
Standing analysis begins with Rule 4:26-1, which provides, "[e]very
action may be prosecuted in the name of the real party in interest." "Standing
refers to the plaintiff's ability or entitlement to maintain an action before the
court." N.J. Citizen Action v. Rivera Motel Corp., 296 N.J. Super. 402, 409
(App. Div. 1997) (citing N.J. State Chamber of Com. v. N.J. Election L. Enf't
Comm'n, 82 N.J. 57, 67 (1980)). "Courts will not entertain matters in which
plaintiffs do not have sufficient legal standing." Ibid. (citing In re Quinlan, 70
N.J. 10, 34 (1976)).
"New Jersey courts have taken a liberal approach to standing." Slater v.
Holmdel Twp., 20 N.J. Tax 8, 11 (Tax 2002) (citing Dome Realty, Inc. v. City
of Paterson, 150 N.J. Super. 448, 452 (App. Div. 1977)). "To possess standing
in a case, a party must present a sufficient stake in the outcome of the litigation,
a real adverseness with respect to the subject matter, and a substantial likelihood
that the party will suffer harm in the event of an unfavorable decision." In re
Camden Cnty., 170 N.J. 439, 449 (2002) (citing N.J. State Chamber of Com., 82
N.J. at 67-69).
Under the plain language of the Security Agreement and the Law Firm
Agreement, plaintiff did not assign his malpractice claim to third parties.
A-3587-22 14 Rather, he assigned to Tsairis and the Law Firms a limited portion of his
anticipated recovery in the action, after first using the proceeds to pay his own
legal costs and attorneys' fees, to satisfy amounts he owed to those third parties.
When contractual terms are clear, courts "must enforce the contract as
written." Graziano v. Grant, 326 N.J. Super. 328, 342 (App. Div. 1999). "The
document must be read as a whole, in 'accord with justice and common sense.'"
Cumberland Cnty. Imp. Auth. v. GSP Recycling Co., Inc., 358 N.J. Super. 484,
497 (App. Div. 2003) (quoting Krosnowski v. Krosnowski, 22 N.J. 376, 387
(1956)). The contract "should not be interpreted to render one of its terms
meaningless." Ibid.
In the Security Agreement, plaintiff pledged as collateral a portion of his
anticipated recovery in this action to secure payment of $289,470 he owes
Tsairis pursuant to the Tsairis Agreement. The Security Agreement provides
plaintiff "assigns, transfers and pledges to [Tsairis] . . . a continuing security
interest in and lien" on his "right, title and interest in and to the Collateral." It
defines "Collateral" to mean plaintiff's "right, title and interest, in and to all
money, directly or indirectly, recovered (i.e., settlement funds, collections on
judgment, etc.), net of [plaintiff's] attorneys['] fees and litigation costs . . . (Net
Settlement)." It continues, "upon the receipt of the Net Settlement by
A-3587-22 15 [plaintiff's] Law Firm . . . , so much of the Net Settlement necessary to pay-off
and satisfy the Loan shall be forthwith paid to [Tsairis] by [plaintiff's] Law
Firm."
As the court correctly acknowledged, the Security Agreement "does not
indicate an assignment of any claims." Rather, it expressly and clearly limits
the assignment to plaintiff's "right, title and interest, in and to all money, directly
or indirectly, recovered" in this malpractice action. (emphasis added). Nothing
in the Security Agreement gives a third party the right to pursue any claims held
by plaintiff, and it is undisputed plaintiff is prosecuting this malpractice action
in his own name.
The Security Agreement creates an obligation by plaintiff to pay Tsairis
$289,470 from his recovery in this action, after first satisfying plaintiff's own
litigation costs and attorneys' fees. Importantly, and contrary to the court's
finding, under the Security Agreement, the first recipients of any portion of the
recovery are plaintiff and his lawyers, not third parties. Only after plaintiff is
made whole for his costs and attorneys' fees will Tsairis be entitled to recover
any portion of the proceeds. Therefore, the court's finding that plaintiff is
"merely seeking a judgment that is to be paid directly to the third parties" is
incorrect. He stands to benefit directly and substantially from the judgment; he
A-3587-22 16 will not "receive the benefit of the judgment in name only" as the court
mistakenly found.
Likewise, the Law Firm Agreement merely creates a lien against his
personal recovery in this action in exchange for the Law Firms' agreement to
forebear collection of the fees they are owed until resolution of this action.
Nothing in that agreement could possibly be construed as an assignment of a tort
claim, nor could it be interpreted to create a lien for more than the $253,725
plaintiff owes in fees.
In addition, plaintiff seeks an award in excess of $4,000,000 in this action.
He owes Tsairis $289,470 and the Law Firms $253,725. To the extent his
recovery, after paying his own costs and attorneys' fees, exceeds the total
amount he owes Tsairis and the Law Firms, he will also retain the excess amount
recovered. The Security Agreement expressly provides Tsairis "shall release the
Collateral" upon satisfaction of plaintiff's liability under the Tsairis Agreement,
and the Law Firm Agreement only creates a lien in the amount plaintiff owes
the Law Firms. Any amount recovered above the amounts owed to Tsairis and
the Law Firms will be retained by plaintiff.
We are not persuaded by defendants' argument Tsairis' right under the
"Collateral & Default" provision of the Security Agreement to "sell or otherwise
A-3587-22 17 dispose of any or all of the Collateral" in the event of default means plaintiff
assigned the tort claim. The Security Agreement defines "Collateral" as monies
recovered in this action, net of plaintiff's costs and fees. When interpreting a
contract, it "must be read as a whole, in 'accord with justice and common sense'"
and not as "to render one of its terms meaningless." Ibid. (quoting Krosnowski,
22 N.J. at 387). Interpreting this provision of the Security Agreement to
essentially redefine the term "Collateral" would contradict the overall intent of
the Security Agreement when read as a whole and would render the definition
of the term "Collateral" meaningless.
The court incorrectly found plaintiff lacked standing to bring this action.
He remains the real party in interest and possesses a sufficient stake in the
outcome of the litigation to establish standing.
B.
We also conclude the assignment of the future proceeds of a tort action is
permissible when the injured plaintiff continues to prosecute the action in their
own name and has standing to do so.
It has long been the rule in New Jersey that a tort claim cannot be assigned
prior to judgment. Vill. of Ridgewood v. Shell Oil Co., 289 N.J. Super. 181,
195 (App. Div. 1996) (citing E. Orange Lumber Co. v. Feiganspan, 120 N.J.L.
A-3587-22 18 410, 413 (Sup. Ct. 1938), aff'd, 124 N.J.L. 127 (E. & A. 1940)). It is undisputed
a legal malpractice claim is a tort claim. Grunwald v. Bronkesh, 131 N.J. 483,
492 (1993). There is also no dispute a judgment can be assigned after the
judgment is entered. Pursuant to N.J.S.A. 2A:25-1, "all judgments and decrees
recovered in any" court "shall be assignable, and the assignee may sue thereon
in their own name."
However, an assignment limited to the anticipated proceeds of a tort
claim, as opposed to the tort claim itself, is permissible so long as the injured
person prosecutes the action in their own name and has standing to do so. See
Cronin v. McKim-Gray, 353 N.J. Super. 127, 131 (App. Div. 2002) (permitting
assignment of anticipated recovery in tort claim to satisfy outstanding medical
bills); Ladenheim v. Klein, 330 N.J. Super. 219, 223 (App. Div. 2000)
(permitting creation of an equitable lien against anticipated recovery in tort
claim to satisfy outstanding medical bills); Berkowitz v. Haigood, 256 N.J.
Super. 342, 347 (Law Div. 1992) (permitting assignment of anticipated recovery
in tort claim to satisfy outstanding medical bills).
Defendants' reliance on Village of Ridgewood is misplaced. 289 N.J.
Super. at 181. There, Ridgewood sued several oil companies and other
defendants for damages resulting from contamination of drinking-water wells.
A-3587-22 19 Id. at 186. Ridgewood settled with the oil companies, accepted a settlement
payment "in full settlement of the claims," and released the oil companies from
liability. Id. at 188.
As a part of the settlement, Ridgewood assigned to the oil companies "all
its legal rights against all parties potentially responsible for the well
contamination." Id. at 187. The agreement provided, "[u]nder the
assignment . . . from Ridgewood, the litigation will proceed in the name of
Ridgewood but with the proceeds of any judgment going to the [o]il
[c]ompanies." Ibid. Under those circumstances, we held the assignment of
Ridgewood's tort claims was impermissible because "[i]t has always been held
that the right to bring an action in the courts of this state is possessed by the
injured person alone, unless the injured person assigns [their] right to someone
else, which cannot be done before judgment when the action sounds in tort." Id.
at 196 (first alteration in original) (quoting U.S. Cas. Co. v. Hyrne, 117 N.J.L.
547, 552 (E. & A. 1937)).
Defendants' reliance on Alcman Services Corp. v. Bullock, P.C., 925 F.
Supp. 252 (D.N.J. 1996) is unavailing for the same reasons. There, the parties
to an underlying action attempted to assign to Alcman a "cause of action for
attorney malpractice" against Bullock. Id. at 256. Alcman then sued Bullock
A-3587-22 20 as assignee of the third-party's malpractice claim. Ibid. The court held the
assignment of a cause of action for legal malpractice to a third party was
impermissible under New Jersey law. Id. at 260.
Here, plaintiff is prosecuting this action in his own name, retains control
over the litigation, and stands to recover a significant portion of any damages
award. The limited assignments in this case are not the equivalent of an
assignment of a tort claim and do not run afoul of the prohibition on assignment
of tort claims prior to judgment.
Defendants' claim public policy favors affirming the court's dismissal of
the action is not convincing. They argue "[t]here is . . . an implicit bias at issue
that would have been highly prejudicial to" them because Abdy and Tsairis
"were going to be essential fact witnesses." According to defendants, this would
have "resulted in an impermissible and unethical bias" and "a denial of due
process." To the extent the witnesses' personal interests are implicated by their
involvement in the litigation, defendants are free to explore any alleged bias on
cross-examination.
Defendants' argument the assignments violate Rule of Professional
Conduct 3.4(b) lacks merit. RPC 3.4(b) provides "a lawyer shall not . . . offer
an inducement to a witness that is prohibited by law." The agreements in this
A-3587-22 21 case are not offers of "inducement" for Tsairis and Abdy to testify, nor are they
improper agreements to compensate fact witnesses.
C.
We apply "an abuse of discretion standard to [discovery] decisions made
by [the] trial courts." C.A. ex rel. Applegrad v. Bentolila, 219 N.J. 449, 459
(2014) (second alteration in original) (quoting Pomerantz Paper Corp. v. New
Cmty. Corp., 207 N.J. 344, 371 (2011)). "[W]e accord substantial deference to
a trial court's disposition of a discovery dispute." Brugaletta v. Garcia, 234 N.J.
225, 240 (2018). Further, appellate courts "will not ordinarily reverse a trial
court's disposition of a discovery dispute 'absent . . . a judge's misunderstanding
or misapplication of the law.'" Ibid. (quoting Cap. Health Sys., Inc. v. Horizon
Healthcare Servs., Inc., 230 N.J. 73, 79-80 (2017)).
The court denied plaintiff's motions to exclude evidence without
prejudice. It determined plaintiff did not provide information sufficient to
determine whether the evidence should be excluded, and it would be in a better
position to evaluate the admissibility of the evidence after hearing relevant
witness testimony. We do not perceive any basis to disturb the court's decision.
A-3587-22 22 D.
We must address the procedure employed by the court in addressing
defendants' "application" for appropriate relief to provide guidance on how
courts should handle this issue should it arise again in other cases. Plaintiff's
counsel was engaged in jury selection and preparing for trial when he was
unexpectedly served with an untimely and inappropriate "application" to dismiss
the case. The application could not be filed and considered as a motion in limine
because it was dispositive. R. 4:25-8(a)(1). Nor was it filed timely or
appropriately as a motion to dismiss in accordance with Rules 1:6-3 and 4:6-3.
Although it is true lack of standing cannot be waived, Petro v. Platkin, 472 N.J.
Super. 536, 558 (App. Div. 2022) (citing N.J. Dep't of Env't Prot. v. Exxon
Mobil Corp., 453 N.J. Super. 272, 291 (App. Div. 2018)), that does not mean
the defense can be asserted without regard for the Rules of Court.
Rather than adjourn the trial or otherwise fashion an appropriate remedy,
the court required counsel to file written opposition and participate in oral
argument the following day, while simultaneously delivering his opening
statement and presenting plaintiff's testimony. The next day, the court dismissed
plaintiff's case and discharged the jury. Although we appreciate the court's
efforts to resolve this issue on short notice, plaintiff and his counsel deserved a
A-3587-22 23 fair opportunity to oppose defendants' untimely and procedurally deficient
application.
E.
Finally, considering the facts and circumstances of the case, we direct the
Presiding Judge of the Civil Part to assign this case to a different judge on
remand. See Graziano, 326 N.J. Super. at 350 (stating the power to remand a
case to a different judge "may be exercised when there is a concern that the trial
judge has a potential commitment to [their] prior findings"); see also Freedman
v. Freedman, 474 N.J. Super. 291, 308 (App. Div. 2023) (remanding a matter to
a different judge as the same judge "may have a commitment to [their] prior
findings").
Reversed in part and affirmed in part. We do not retain jurisdiction.
A-3587-22 24