by: Peter J. Gallagher (@pjsgallagher) (LinkedIn)
It is not often that a case that starts in the Special Civil Part — New Jersey's small-claims court — ends up before the New Jersey Supreme Court. But this is exactly what happened in Williams v. American Auto Logistics. It could not have been cost effective for the plaintiff to see this case through two separate bench trials, two separate appeals to the Appellate Division, and finally an appeal to the Supreme Court. But the issue in the case was so important that, notwithstanding the costs, the effort was likely worthwhile.
In Williams, plaintiff had his car shipped from Alaska to New Jersey by defendant. After he picked up the car, he discovered water damage in the trunk. Plaintiff sued in the Special Civil Part after efforts to amicably resolve the dispute failed. Plaintiff did not demand a jury trial in his complaint, but defendant did in its answer. At the pretrial conference, the trial court referred the parties to mediation, which was unsuccessful. Upon returning from mediation, defendant waived its jury demand. Plaintiff objected, but the trial court granted defendant's request. In support of its decision, the trial court noted that plaintiff had violated Rule 4:25-7 by failing to make the requisite pretrial submissions. (Among other things, Rule 4:25-7 requires parties to submit proposed voir dire questions, jury instructions, and jury verdict forms.) The trial court held that it could deny plaintiff's request for a jury trial as a sanction for this failure. Therefore, the case proceeded to a bench trial, where the trial court found no merit to plaintiff's claims.
Plaintiff appealed and the Appellate Division reversed and remanded. It held that a jury demand can only be withdrawn by consent, even when only one party demanded a jury trial and that party seeks to withdraw the demand. It further explained that "a trial judge may impose sanctions, including striking the jury demand, on a party that fails to submit the requisite pretrial information," but that the trial court in Williams erred by "allowing a single party to unilaterally waive the jury demand."
On remand, the same trial court relied on the Appellate Division's statement that waiver of a jury demand is an appropriate sanction for failing to submit the requisite pretrial information and again denied plaintiff's request for a jury trial. The trial court referred the case to a new judge for a bench trial, but the result was the same, the new court found in defendant's favor.
Plaintiff appealed again, but this time the Appellate Division affirmed the trial court's decision. In doing so, it rejected plaintiff's arguments (1) that the trial court "ignored the Appellate Division's instruction in its first opinion," and (2) that Rule 4:25-7 does not apply to matters in the Special Civil Part.
The Supreme Court granted plaintiff's petition for certification on these issues, and reversed. The Supreme Court held that "New Jersey has upheld the importance of jury trial in constitutions that date back to the origins of our nation," and that the jurisprudence of New Jersey courts "confirms the strength of [New Jersey's] commitment to protecting the right to a jury." The Supreme Court held that loss of this bedrock constitutional right "could not be wielded as a penalty." Therefore, it held that denying a litigant the right to a jury trial cannot be imposed as a sanction for procedural defects in the litigant's case.
The Supreme Court conceded that trial courts have "expansive discretion" to manage their dockets. This discretion provides them with a "wide array of available remedies to enforce compliance with a court rule or one of [their] orders," including: holding a party in contempt; precluding a party from submitting evidence; entering an adverse inference against a party; imposing monetary penalties; ordering a new trial; or even dismissing a complaint with prejudice. But, given the sacrosanct nature of the right to a jury trial, "removing a party's constitutionally protected right to a jury trial is not among" the remedies available to trial courts for a litigant's failure to abide by the court rules.
The Supreme Court also held that Rule 4:25-7 does not apply to matters in the Special Civil Part for two reasons. First, Part VI of the court rules, which governs proceedings before the Special Civil Part, only expressly incorporates Rules 4:25-1 through 4:25-6 as applicable to the Special Civil Part. Because it does not incorporate Rule 4:25-7, that rule does not apply in the Special Civil Part. Second, in 2006, the Supreme Court Committee on Special Civil Part Practice rejected a proposal to specifically incorporate Rule 4:25-7 into the Special Civil Part rules. It did so because it concluded that "the typical Special Civil Part case simply does not warrant the extensive exchange of information required by Rule 4:25-7 . . . and . . . an exchange on the trial date would be just as effective and certainly less expensive for the litigants."
In light of these decisions, the Supreme Court reversed the trial court and Appellate Division and remanded the case back to the trial court for a new trial. It remains to be seen whether the third time (although the first time in front of a jury) will be the charm for plaintiff.