I Thought That Juror Looked Familiar!

by: Peter J. Gallagher (@pjsgallagher) (LinkedIn)

What happens if you are a party in a lawsuit and you recognize one of the jurors as someone who not only knows you, but probably does not like you and may be looking for revenge? According to the Appellate Division in Rumbas v. Sony Electronics, Inc., at the very least, you bring it up before the jury returns its verdict.

In Rumbas, plaintiff claimed that a television defendant manufactured was defective and caused a fire that damaged plaintiff’s condominium unit and three other units. At the start of jury selection, the judge explained the nature of the case to the potential jurors. He then sat the first eight jurors in the jury box and explained the jury selection process. Specifically, he explained that he would be asking a series of 28 questions, each of which was “designed to elicit a negative response.” As jurors in the box were excused, they would be replaced by jurors from the panel, but the judge would not repeat the 28 questions. Instead, he would simply ask the replacement juror if his or her answer to any of them would be anything other than “no.” Therefore, the judge stressed that it was important for all jurors, not just those in the jury box at the time, to pay attention to the questions.

Early on in the selection process, while the original eight jurors were seated in the jury box, the judge asked the attorneys to introduce their clients. Plaintiff was not in the courtroom at the time. Apparently, he had to go to the pharmacy, but his attorney indicated that he would be returning soon. The judge then read a list of potential witnesses and asked if any of the jurors knew any of them. None did. During this questioning, plaintiff returned to court, at which time he was introduced to the jurors. The judge asked if any of them knew plaintiff, but none did.

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Party Cannot Lose Its Right To Jury Trial For Violating Procedural Rules

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."

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Bank Has No Duty To Report Suspected Scam Perpetrated On Customer

by: Peter J. Gallagher (@pjsgallagher)

Does a bank have a duty to tell authorities that it believes one of the bank's customers is the victim of a scam? In a recent decision — Lucca v. Wells Fargo Bank, N.A. — the Law Division held that banks can report suspected scams (and will generally be shielded from liability against the customer suspected of being scammed if they do) but are not required to do so.

In Lucca, plaintiff made approximately 27 wire transfers totaling roughly $330,000, most of which were sent to Costa Rica to recipients that plaintiff did not know and never met. She did so at the direction of an individual who called her, identified himself as a lawyer, told her that he had a way for her to win some money, and provided her with information about the wire transfers that were part of the alleged money winning proposition. Plaintiff sued her bank and the individual at the bank with whom she interacted in connection with the wire transfers, claiming, among other things, that the bank acted in bad faith when it failed to "disclose the wire transfers to the appropriate authorities." The trial court held a two-day bench trial on this claim and dismissed this claim.

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For Richer And For (Perhaps Very Shortly) Poorer: Wife Must Testify About Husband’s Allegedly Hidden Assets

by: Peter J. Gallagher (@pjsgallagher)

For husbands, the lesson from a recent Appellate Division opinion is that you cannot assert the marital privilege in an attempt to keep their wives from being deposed by a judgment creditor about assets that you might be trying to conceal from that judgment creditor. In U.S. Electrical Services, Inc. v. Electrical Solutions Group, Inc., plaintiff obtained a judgment for approximately $165,000 against defendants (a corporation and an individual who was alleged to be the sole shareholder of the corporation). In post-judgment proceedings, plaintiff applied for, and obtained, an order of discovery permitting the deposition of the individual defendant's wife based upon plaintiff's assertion that she had knowledge of certain assets that the individual defendant had failed to disclose.

The individual defendant moved to vacate the order, arguing that any testimony from his wife would be subject to the marital privilege — codified at N.J.SA 2A:84A-22 — and that he did not consent to the disclosure of the information. The trial court denied the motion, holding that the individual defendant's wife could be deposed about her "first-hand knowledge and observations of facts and occurrences." The individual defendant appealed.

The Appellate Division affirmed the trial court's order. It started with the general proposition that privileges must be narrowly construed. With this in mind, it turned to the specific elements of the marital privilege: (1) a communication; (2) made in confidence; (3) between spouses. The Appellate Division further noted that the purpose of the privilege is to "encourage[] free and uninhibited communication between spouses, and, consequently, [to] protect[] the sanctity and tranquility of marriage." But, because the "only effect" of the privilege is to "suppress[] [] relevant evidence," it must be "confined as narrowly as is consistent with the reasonable protection of marital communications."

In U.S. Electrical Services, the individual defendant argued that any "personal and business financial records" that he "brought into the martial home where [his wife] may have seen them [were] necessarily [ ] confidential communication[s] between spouses." The Appellate Division disagreed for a number of reasons.

First, it held that documents that were stored in the marital home and were observed by a spouse do not a "confidential communication" make. The privilege protects communications, not conduct or occurrences. Thus, a wife's observations of what her husband did, including bringing documents into the marital home, are not covered by the privilege. The court did hold, however, that communications about the documents could potentially be protected under the marital privilege "provided the right proofs" (which were not present in the instant case).

Second, the Appellate Division held that the contents of the documents were not automatically privileged "just because both parties have seen them." In this regard, the court held that many business and financial records are generated by, or submitted to, third parties outside of the marital home. As a result, they may not be confidential at all. Moreover, the Appellate Division observed that, even if documents were initially confidential, "placement in the home where another member of the household or a guest could discover them does not guarantee continued confidentiality." At a minimum, a party seeking to assert the privilege would have to demonstrate that the underlying documents remained confidential while in the marital home.

Third, the Appellate Division held that the act of leaving document in the marital home does not encourage communications between spouses or protect marriages, the very purpose behind the privilege. Absent convincing evidence that applying the privilege would protect and further the interests it was designed to advance, the Appellate Division saw no reason to recognize the privilege.

Ultimately, the take home message from U.S. Electrical Services is that simply bringing documents into the marital home, and even sharing them (or making them visible or available to your spouse) does not bring the existence or content of those documents within the marital privilege. But, both the trial court and Appellate Division left open the possibility that communications about such documents, in the right situation, might be privileged.

Going Once . . . Going Twice . . . Sold! To The Person Who Cannot Remain Anonymous!

by: Peter J. Gallagher (@pjsgallagher)

While data breaches and cyber security are, unfortunately, regular topics on the nightly news, a New Jersey trial court recently dealt with a much more low-tech privacy issue. In Brennan v. Bergen County Prosecutor’s Office, the trial court addressed the “intriguing question” (the court’s words, not necessarily mine) of “whether the winning bidders in a public auction have a reasonable expectation of privacy in their personal information transmitted to a public agency in connection with their participation in [a public] auction.” In other words, if you are the winning bidder at a public auction, must the public entity that held the auction produce documents revealing your identity in response to an OPRA request? In Brennan, the trial court’s answer was a qualified yes.

In Brennan, the Bergen County Prosecutor’s Office seized baseball memorabilia from an individual who it alleged had illegally sold prescription drugs. The memorabilia was later sold at an auction administered by a third-party that the prosecutor’s office hired to handle the auction. Plaintiff filed an OPRA request seeking, among other things, documents that would reveal the identities of the winning bidders at the auction – registration forms and bid documents that revealed names and phone numbers of the winning bidders. The prosecutor’s office refused to provide this information, claiming that the winning bidders reasonably expected that their identities would not be made public. Plaintiff sued to compel the production of the documents.

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