Zaccardi v. Becker

440 A.2d 1329, 88 N.J. 245, 1982 N.J. LEXIS 1872

• Court: Supreme Court of New Jersey
• Decided: January 27, 1982
• Status: Published

Opinions

The opinion of the Court was delivered by

PASHMAN, J.

This case presents two separate questions. First, when does a plaintiff’s failure to answer interrogatories result in the dismissal of his case with prejudice? Second, if such a dismissal is without prejudice, when is a second complaint barred by the statute of limitations? Under the special circumstances presented here, we hold that the prior complaint was not dismissed with prejudice and that defendants are not entitled to assert the statute of limitations as an affirmative defense. We reverse the contrary judgment of the Appellate Division and remand to the trial court for further proceedings.

I

This is the second suit brought by plaintiffs against two defendant doctors¹ to recover damages for alleged medical malpractice in connection with treatment rendered to plaintiff Anthony Zaccardi from 1974 to 1975. The complaint in the first suit, identical to the complaint in this case, was filed in January 1976. On July 28, 1976 the trial court dismissed the complaint under R. 4:23-5(a) for plaintiffs’ failure to answer defendants’ interrogatories. For 17 months, despite the dismissal, the case remained on the docket and was adjourned for discovery at least ten times. Plaintiffs did not apprise the trial court of the earlier dismissal, and defendants did not object to the repeated adjournments. Finally, on December 28, 1977, plaintiffs moved to vacate the dismissal and asked for a 60-day extension for discovery. The trial court granted the motions in February 1978. In September 1978 the Appellate Division reversed and reinstated the order of dismissal, without explicitly determining whether such dismissal had been with prejudice. We denied certification. Zaccardi v. Becker, 162 N.J.Super. 329 (App.Div.), certif. den., 79 N.J. 464 (1978) (Zaccardi I).

On November 17, 1978, one month before the Supreme Court denied certification in Zaccardi I, plaintiffs filed a new complaint that was identical to the first. The trial court dismissed the second complaint, holding that the dismissal in Zaccardi I had been final and that the applicable limitations period had run. The Appellate Division affirmed. We granted plaintiffs’ petition for certification on November 25, 1980.

II

The first issue in this case is the standard to be applied in determining when a dismissal for failure to answer interrogatories bars the filing of a new complaint.

R. 4:17-4(b) gives a party 60 days within which to answer interrogatories. R. 4:23-5(a) provides that if timely answers are not served, “and no formal motion for an extension has been made pursuant to R. 4:17-4(b) * * *,” the complaint can be dismissed upon ex parte application by the party entitled to the answers within 60 days of the default.² Under this scheme, dismissal for failure to answer interrogatories is without prejudice, since it is based on an ex parte application. See Schlosser v. Kragen, 111 N.J.Super. 337, 344 (Law Div.1970).

Dismissal is not necessarily final since the delinquent party may move to vacate the dismissal within 30 days after service of the dismissal order, provided that the delinquent party furnishes fully responsive answers to the interrogatories and pays $50 costs to the Clerk of the Superior Court. R. 4:23-5(a).

Upon motion, the court has discretion whether or not to vacate the dismissal. Normally, when the motion is made within the 30-day limit and all other requirements are met, the motion will be allowed. However, vacation of the dismissal will be disfavored if the delinquent party has failed to comply with the 30-day limit without having moved for an extension of time under R. 4:17-4(b). Failure to move to vacate the dismissal within the 30-day limit set by R. 4:23-5(a) does not by itself bar vacation of the dismissal. Id. at 345-46. The court has discretion to relax the 30-day limit pursuant to R. 1:1-2 to prevent injustice.

Nonetheless, the 30-day limit should be relaxed very sparingly. Routinely allowing attorneys to ignore the time limits in R. 4:23-5(a) would subvert the policy of encouraging expeditious discovery. Attorneys cannot avoid these limits without satisfactory reasons. Moreover, since it is possible to move for an extension of time to answer interrogatories under R. 4:17-4(b), there must be good reason for relaxation of the rule. As the Appellate Division observed in Zaccardi I,

[i]f our discovery rules are to have any meaningful effect upon calendar control and the early disposition of litigation, they must be adhered to unless, for good cause shown, they are relaxed under B. 1:1-2. The imposition of the severe sanction of dismissal is imposed not only to penalize those whose conduct warrant it, but to deter others who may be tempted to violate the rules absent such a deterrent. [162 N.J.Super. at 332]

Attorneys must comply with the time limits in the procedural rules in order to further the public policies of expeditious handling of cases, avoiding stale evidence, and providing uniformity, predictability and security in the conduct of litigation. See id. at 332-33; Gnapinsky v. Goldyn, 23 N.J. 243, 247-48 (1957). The Appellate Division in Zaccardi I rightly refused to vacate the original dismissal 17 months after it was ordered.

When a party moves to vacate a dismissal, a second issue arises. Not only must the court decide whether to vacate the dismissal, but, if it is not vacated, the court must decide whether the dismissal is to be with prejudice. These two decisions are logically independent, and the policy considerations behind each decision are somewhat different. We now address the standard to be applied in determining whether a second complaint should be barred. This is the first time we have addressed this issue in the context of the current R. 4:23-5(a).

Competing policies are involved in disputes over procedural questions such as this. The defendant’s right to have the plaintiff comply with procedural rules conflicts with the plaintiff’s right to an adjudication of the controversy on the merits. Crews v. Garmoney, 141 N.J.Super. 93, 96 (App.Div.1976).

Because of these competing policies, and because of the varying levels of culpability of delinquent parties, a range of sanctions is available to the trial court when a party violates a court rule.³ Gnapinsky v. Goldyn, 23 N.J. at 247-48. See, e.g., R. 4:23-2, -4. Thus, although it is the policy of the law that discovery rules be complied with, it is also the rule that drastic sanctions should be imposed only sparingly. Lang v. Morgan’s Home Equipment Corp., 6 N.J. 333, 339-40 (1951); Schlosser v. Kragen, 111 N.J.Super. at 341. 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, see id. at 346; Savoia v. Woolworth, 88 N.J.Super. 153, 160-61 (App.Div.1965); Gnapinsky v. Goldyn, 23 N.J. at 248, or when the litigant rather than the attorney was at fault, Schlosser v. Kragen, 111 N.J.Super. at 346; Savoia v. Woolworth, 88 N.J.Super. at 161.

Thus, dismissal for failure to answer interrogatories should not ordinarily bar the plaintiff from filing a new complaint within the statute of limitations. W. Milford Tp. Bd. of Ed. v. Rockwell Mfg. Co., 173 N.J.Super. 506, 508 (Law Div.1980). However, when a second complaint is filed, the trial judge in the second case may, if he deems it equitable, dismiss the second complaint, even though the first complaint was dismissed without prejudice. Because of the severity of the sanction, it should be used only sparingly. It would be appropriate only when the second complaint was filed merely to harass the defendant, when the delay has so prejudiced the defendant that his ability to defend his case is seriously impaired, or when other substantial equitable considerations suggest dismissal. It should be remembered that dismissal of the second complaint will deprive a plaintiff of an adjudication on the merits. See Central R. R. v. Neeld, 26 N.J. 172, 177 (1958) (holding that doctrine of res judicata does not normally come into play where the parties have not had an adjudication on the merits).

The complaint in Zaccardi I was dismissed without prejudice. Dismissal for failure to comply with a court rule or order shall be without prejudice unless the order specifically states that it is to be with prejudice. R. 4:37-2(a). See W. Milford Tp. Bd. of Ed. v. Rockwell Mfg. Co., 173 N.J.Super. at 508. Mere language in the judicial opinion of strong disapproval of misconduct or delay is not enough to convert a “dismissal” to a “dismissal with prejudice.” Since the order in Zaccardi I did not explicitly specify that it was with prejudice, a new complaint was not barred by that decision.

We turn therefore to the question of whether the second complaint should be barred on equitable considerations. Plaintiffs’ inordinate delay in this case in moving to vacate the dismissal and their’ failure to bring, the dismissal to the court’s attention are highly improper. This is particularly true in light of the fact that despite the dismissal, the case remained on the docket. Plaintiffs’ attorneys had numerous opportunities to bring the prior dismissal to the court’s attention. Justice Weintraub stated in Gnapinsky v. Goldyn,

The rules of court are designed to expedite litigation and are intended for the equal benefit of all parties... . There are situations in which relief from the prescribed timetable is warranted, .. . [b]ut the discretion is to be exercised by the courts and not by the unilateral decision of counsel for one of the parties. [23 N.J. at 247-48]

Even though plaintiffs appeared in court seeking adjournments of the case, they failed to advise the court that it had been dismissed.

In the ordinary case, such a course of conduct warrants appropriately severe sanctions.

[I]t is necessary that there be adequate provisions for the enforcement of the rules as to discovery against those who fail or refuse to comply. Sanctions are peculiarly necessary in matters of discovery and the power to invoke them is inherent in our courts. [Lang v. Morgan’s Home Equipment Corp., 6 N.J. at 338]

Counsel should be admonished for his disregard of the rules of court. No attorney should assume that despite his failure to comply with the rules, the Court will allow the case to proceed. Gnapinsky v. Goldyn, 23 N.J. at 256 (Vanderbilt, C.J., dissenting). In the absence of adequate justification, these factors presented a strong case for dismissal of this complaint with prejudice. However, there are mitigating circumstances.

Although plaintiffs’ attorney acted wrongfully in failing to bring the dismissal to the court’s attention, defendants had notice of the many adjournments and contributed to the delay by not notifying either plaintiffs or the court that they objected to the adjournments. Under the circumstances, plaintiffs could reasonably have believed that defendants impliedly consented to the continuation of the ease as an ongoing controversy. Equitable considerations consequently do not require dismissal of this second complaint.

We therefore conclude that plaintiffs’ second complaint should not be barred on equitable grounds.

Ill

The second issue in this case is whether defendants are entitled to assert the statute of limitations as an affirmative defense to bar plaintiffs’ second complaint. The first complaint was filed on January 20, 1976. It alleged that the wrong had been committed on March 12,1974, and was thus filed within the two-year limitation period. The complaint was dismissed on July 28,1976 for failure to answer interrogatories. For the next 17 months, however, the case was repeatedly adjourned and remained on the active trial calendar until plaintiffs’ motion to vacate the dismissal was granted by the trial court on February 10, 1978. Approximately two months after the Appellate Division reversed the vacation of the dismissal on September 28, 1978, and several weeks before the Supreme Court denied certification, plaintiffs filed a second complaint, identical to the first, which is the subject of the present appeal.

At the outset we note that statutes of limitations are not self-executing. Such statutes are based on the goals of achieving security and stability in human affairs and ensuring that cases are not tried on the basis of stale evidence. Galligan v. Westfield Centre Service, 82 N.J. 188, 191-92 (1980); Tevis v. Tevis, 79 N.J. 422, 430 (1979); Kaczmarek v. N. J. Turnpike Authority, 77 N.J. 329, 337-38 (1978). Because they are based on these specific policies, they must be raised as affirmative defenses, subject to judicial modification in appropriate circumstances. Mechanistic application of such statutes could unnecessarily sacrifice individual justice in particular circumstances.

A just accommodation of individual justice and public policy requires that in each case the equitable claims of opposing parties must be identified, evaluated and weighed. Whenever dismissal would not further the Legislature’s objectives in prescribing the limitation, the plaintiff should be given an opportunity to assert his claim. [Galligan, 82 N.J. at 193 (citations omitted) ]

See Kaczmarek v. N. J. Turnpike Authority, 77 N.J. at 338; White v. Violent Crimes Compensation Board, 76 N.J. 368, 379 (1978); Farrell v. Votator Div. of Chemetron Corp., 62 N.J. 111, 121 (1973).

In light of these considerations, this Court has often rejected a limitations defense where defendant has contributed to the delay. We have stated:

[Sjtatutes of limitations are characteristically considered to be tools of repose. They require that alleged rights be timely asserted and thereby operate to prevent unjust claims. They obviate the difficulties in defending actions against such claims .... Where, however, the bar is used primarily as a sword rather than a shield and by one who has been responsible to disclose the actionable essentials in the face of a duty to speak, factors of vicarious enrichment become a dominant consideration which we are prone to remedy in equity and good conscience. [State v. United States Steel Corp., 22 N.J. 341, 358-59 (1956)]

We have disallowed limitations defenses in a variety of situations because of defendant’s inequitable conduct. For example, in United States Steel, we rejected an otherwise valid statute of limitations defense because the defendant failed to fulfill a legal duty to notify the State of escheatable property in its possession. Id. at 360. See Peloso v. Hartford Insurance Co., 56 N.J. 514 (1970); Friedman v. Friendly Ice Cream Co., 133 N.J.Super. 333 (App.Div.1975) (both holding that defendant insurer who uses settlement negotiation to lull plaintiff into delaying the filing of an action is estopped from asserting expiration of the limitation period);. cf. Barres v. Holt, Rinehart and Winston, Inc., 131 N.J.Super. 371 (Law Div.1974), aff’d o. b., 141 N.J.Super. 563 (App.Div.1976), aff’d o. b., 74 N.J. 461 (1977) (although defendant publisher successfully raised statute of limitations defense, plaintiff permitted to amend his complaint to seek equitable relief against the publisher if he obtained a judgment against co-defendant author).

Although not identical to these cases, the instant appeal is sufficiently similar to require the application of equitable principles to estop defendants from raising the statute of limitations as an affirmative defense. It is clear that the second complaint in this case was brought more than two years after the date on which the wrong was allegedly committed. Thus, if that fact alone were determinative, the second complaint would be barred by the statute of limitations. N.J.S.A. 2A:14-2. However, under the cases noted above, defendant’s conduct is relevant to the availability of a statute of limitations defense. In this case, an identical previous complaint had been timely filed. Defendants were well aware that plaintiffs’ first complaint had been dismissed in July 1976 for failure to answer interrogatories. Nevertheless, for the following 17 months, while the case remained on the trial calendar of the Superior Court and was actually adjourned for discovery at least ten times, defendants took no steps to inform the court that the case had been dismissed or to object to the adjournments. Rather, they added to the delay while plaintiffs acted under the reasonable misapprehension that the defendants had agreed to the continuation of the case. In fact, defendants did not question the pendency of the lawsuit until plaintiffs moved to vacate the dismissal. Then for the first time defendants argued that plaintiffs’ case had been dismissed with finality. This contention was inconsistent with defendants’ conduct over the preceding year and a half. We believe defendants’ counsel was under a duty to bring to the trial court’s attention the fact that a case on the trial calendar had already been dismissed. Having thus significantly contributed to the delay in adjudicating this case, he cannot now claim on behalf of his clients that the case is stale and ought not to be heard.

We recognize that this ruling works a hardship on defendants, who appear to be no more culpable for their attorney’s lapses than plaintiffs are for theirs. Nonetheless, we conclude that under the facts of this case, the interests of plaintiffs in an adjudication on the merits must outweigh the defendants’ right to assert the statute of limitations. Given the series of adjournments and the process of appellate litigation which followed the motion to vacate the dismissal, it appears that the case has remained alive. Because the initial complaint was timely filed, defendants have had adequate warning to prepare their defense. Moreover, the second complaint was brought even though appellate litigation involving the first complaint was still in progress. Viewed in this light, it seems that the second complaint was brought as soon as possible — if not prematurely — since there was pending appellate litigation concerning the first complaint.

In a concurring and dissenting opinion, Justice Schreiber concludes, on the basis of a case decided in New Jersey in 1841, that the statute of limitations is not tolled between the time of the filing of the first complaint in January 1976 and its dismissal in July 1976. Our colleague states that tolling in this case is based on circumstances which admittedly did not occur until after the dismissal of the first complaint. We agree that if the only issue were defendants’ actions, this second complaint would be barred by the statute of limitations on precisely the grounds advanced by Justice Schreiber.

However, that is not the law in New Jersey. While it may be true that the statute of limitations continues to run after a complaint is filed, Ivins v. Schooley, 18 N.J.L. 269 (Sup.Ct.1841), it is no longer the case that such statutes are mechanistically applied. It is now well settled in New Jersey that statutes of limitation will not be applied when they would unnecessarily sacrifice individual justice under the circumstances.⁴ If plaintiffs had filed a second complaint in July 1976, at the time the first complaint was dismissed, we would have allowed the case to proceed on precisely those grounds. Since the first complaint was timely filed, defendants would have had adequate warning to prepare their defense and there would have been no danger of trying the case on stale evidence. Galligan v. Westfield Centre Service, supra. In the absence of prejudice to defendants, we would be reluctant to deprive the plaintiffs of an adjudication on the merits because of their attorney’s actions. Central R.R. v. Neeld, supra. The delay subsequent to July 1976 is attributable to the attorneys on both sides, for the reasons that we have set forth. Since we would have allowed a second complaint in July 1976, we do not agree that settled New Jersey law mandates dismissal of this second complaint because of the statute of limitations.

We are more at a loss to comprehend Justice Pollock’s response to the majority ruling. We in no way approve of the conduct of plaintiffs’ counsel and have stated quite clearly our stem disapproval. We have also indicated disapproval of the conduct of defendants’ counsel. It is argued that defendants’ counsel notified plaintiffs’ counsel that they considered the case closed. Justice Pollock implies that this notification constituted an adequate response to the continued adjournments of the case. We disagree. Since defendants’ counsel knew that the case remained on the docket, rightly or wrongfully, they had an obligation to notify the court of the fact that the case had been dismissed. We find that both plaintiffs’ and defendants’ counsel played havoc with the rules of court. Both deliberately allowed a court of law to act under a misapprehension as to the status of the case. Certainly, it was plaintiffs’ counsel who had a duty under the rules to seek a vacation of the dismissal. Yet we cannot agree that defendants’ counsel shares no part of the blame for the long delay.

We are further accused of seeking to reverse our holding in Zaccardi I because of a “belated concern” for the rights of plaintiffs to an adjudication on the merits, (at 268). We have made clear the differences between the legal issue in Zaccardi I and the legal issue here. Indeed, we have carefully explained that dismissal of a case does not of necessity bar a new complaint.

Further, the dissent criticizes the majority for improperly weighing the equities in this difficult situation, but in vain do we search Justice Pollock’s own opinion for a balanced discussion of the relative rights of the plaintiffs and the defendants. The dissent emphasizes that our holding protects plaintiffs’ counsel and causes great damage to defendants. The wrongs of defendants’ counsel are minimized to the point of implying a judicial imprimatur on their failure to notify the court of its misapprehension of the status of the case. The rights of defendants are discussed at length. Yet not only are the rights of plaintiffs to an adjudication on the merits given little attention, but we are faulted for being concerned about their interests at all. While it is true that the dissent’s analysis would simplify matters, it is difficult to see how it represents a “fairer” solution to the conflict before us.

Under the unique circumstances of this case, we hold that defendants are equitably estopped from asserting the statute of limitations as an affirmative defense. Since defendants’ own conduct contributed to the delay, plaintiffs are entitled to assert their claims.

We reverse and remand to the trial court for further proceedings.

1 Defendant St. Joseph’s Hospital was dismissed as a party by stipulation dated March 26, 1979.

2 R 4:23-5(a) provides:

If timely answers to interrogatories are not served and no formal motion for an extension has been made pursuant to R. 4:17-4(b), the complaint, counterclaim or answer of the delinquent party shall be dismissed or stricken by the court upon the filing by the party entitled to the answers of an affidavit stating such failure within 60 days from the date on which said answers became due. Thereafter such relief may be granted only by motion. The affidavit shall have annexed thereto a form of order of dismissal or suppression. A copy of all such orders with affidavits annexed shall be served upon the delinquent party within 7 days after the date thereof. On formal motion made by the delinquent party within 30 days after service upon him of the order, the court may vacate it, provided fully responsive answers to the propounded interrogatories are presented and the delinquent party pays costs in the amount of $50.00 to the Clerk of the Superior Court.

3 The pre-1964 rule, R. 4:27-4, explicitly listed a variety of possible sanctions, including any action that the court deemed “advisable.” The current rule, although it does not contain a list of possible sanctions, does not explicitly limit the power of the court to a choice between imposing the ultimate sanction of dismissal with prejudice or imposing no sanction at all. The purpose of the rule change was to force the delinquent party to move for a reopening of the case, Schlosser v. Kragen, 111 N.J.Super. at 343-44, and not to strip the court of the power to equitably adjust the controversy by less drastic sanctions when appropriate.

4 See discussion, supra p. 256.