No Expert Needed When Party’s Attempt To Fix Clogged Tub “Bespeaks Negligence”

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

Although I have been a homeowner for a number of years and like to think that I am reasonably handy, my knowledge of plumbing  is probably more informed by Mario Brothers than anything else. As the saying goes, I know just enough about the subject to be dangerous, so I generally try to avoid it. One of the parties in a recent Appellate Division decision, Sayat Nova, LLC v. Koestner, probably would have been better served heading this advice, as the Appellate Division held that no expert was needed to show that it acted negligently when it broke a pipe in a clogged tub that caused flooding in a restaurant several floors down.

In Sayat Nova, plaintiff operated a restaurant in defendant's building. After water from a third-floor apartment came flooding like a "waterfall" out of the ceiling and into the restaurant, plaintiff sued. The incident that precipitated the lawsuit was not the first time that the restaurant flooded. Four times in the previous three years, water entered the restaurant from the same general area in the ceiling. Each incident "involved more water and more damage than the previous incident." Each time plaintiff notified defendant, but never received a response. On one prior occasion, after receiving no response from defendant, plaintiff hired contractors at his own expense to repair the damage. Plaintiff was never compensated for these expenses or any losses caused by the prior incidents. 

In the incident that led to the complaint, water came into plaintiff's restaurant from the ceiling above a different area of the restaurant than in prior incidents. Moments after plaintiff noticed the intrusion, the building's superintendent entered the restaurant with a man plaintiff did not know. Neither man was a licensed plumber. The superintendent told plaintiff: "By mistake we broke the pipe . . . We try to fix the fixture, and the guy by mistake break the pipe." He was apparently referring to a pipe in a third-floor apartment with a "hair-clogged tub." After the incident, defendant called a licensed plumber to fix the problem, but the damage caused plaintiff to have to close his restaurant several days for repairs.

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Appellate Division Quotes Lucinda Williams, Orders Trial Court To Take Closer Look At Whether Debt Was Fully Satisfied

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

Lucinda WilliamsAdd this to the list of things you never want to hear a court say about your performance during a case: "defendants' presentation of evidence certainly gave voice to the song lyric, 'when nothing makes any sense, you have a reason to cry.'" (It is a lyric from a Lucinda Williams song if you were curious.) But this was the Appellate Division's conclusion in Brunswick Bank & Trust v. Heln Management, LLC, a case that was making its second appearance before the Appellate Division (after an earlier remand) and was sent back to the trial court for a third round.

The issue in Brunswick Bank was relatively straightforward. Plaintiff and defendants entered into five loans. The loans were secured by mortgages on several properties owned by defendants. After defendants defaulted on the loans, plaintiff sued and obtained a judgment against defendants. Plaintiff then filed foreclosure actions against defendants, seeking to foreclose on the mortgages it held against defendants' properties. It received final judgments of foreclosure in these cases as well. Some of these properties were then sold, which "provided rolling compensation for [plaintiff] against all defendants' obligations."

At some point during this "rolling" sale of mortgaged properties, defendants moved to stay all pending foreclosure proceedings, arguing that plaintiff was "over-capitalized" – i.e., it was going to collect more than it was entitled to collect under its judgment. Defendants then moved to have the judgment deemed satisfied, arguing that plaintiff had already recovered — through its collection efforts — the full amount of the judgment. The trial court granted the motion but held that two pending foreclosures could proceed. The trial court further acknowledged that it had the power to "prevent a windfall" to plaintiff, but that the record was "too muddled" to decide whether this was the case. 

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Transfer Made On The Morning Of Sheriff’s Sale, For The Purpose Of Delaying The Sheriff’s Sale, Deemed Fraudulent

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

Auction (pd)Sometimes you read decisions and you don't understand how the court arrived at its conclusion based on the facts of the case. Then other times, the conclusion just makes sense. These are the decisions you read and think to yourself, "of course you can't do that." The Appellate Division's opinion in 5 Perry Street, LLC v. Southwind Properties, LLC, is one of these cases.

In Perry Street, defendants were a limited liability corporation and the sole member of that corporation. The corporate defendant owned property in Cape May that it operated as a bed and breakfast.Two "non-institutional lenders" held mortgages on the property. After they foreclosed and obtained a final judgment of foreclosure, a sheriff's sale was scheduled. The corporate defendant obtained four adjournments of the sheriff's sale and attempted to refinance the property, but was "unable to consummate a transaction" before the sheriff's sale. 

Instead, the day before the sheriff's sale, the individual defendant filed for bankruptcy. She then transferred the underlying property from the corporate defendant to herself. The consideration for the transfer was $1 and the "Balance of outstanding mortgages $80,000.00." The $1 consideration was typed into the deed, but the individual defendant hand wrote the part about the outstanding mortgages. She claimed that her intent was to "assume personal liability for the mortgages," but the Appellate Division noted that the balance of the mortgages at the time was almost $250,000, not $80,000, and that other documents she signed reflected that the only consideration was $1. She "filed the deed the next day, an hour and a half before the Sheriff's sale."  

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“Young Man, There’s A Place You Can Go . . .” (But That Place Might Not Be Immune From Liability Under New Jersey’s Charitable Immunity Act If You Later Sue For Injuries You Suffered There)

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

YMCA (pd)These are not alternate lyrics to the the classic Village People song, YMCA, but they could be if the song were written by the Appellate Division panel that recently decided Lequerica v. Metropolitan YMCA of the Oranges.

In Lequerica, plaintiff was injured during a group strength and conditioning class at the YMCA. At one point, the instructor had the the class run toward a wall, touch it, and then return to the wall where they started. According to the Appellate Division:

On her return, plaintiff realized she was going too fast, and when she tried to stop she fell forward and hit her head "extremely hard" on the concrete wall in front of her. While running toward the wall, plaintiff was competing with a friend to see who could reach it first. Before she fell, plaintiff put her arm out in front of her friend in an effort to beat her to the wall. Plaintiff testified she was running so fast she felt she would not be able to stop at the wall, that she "tried to stop herself," and that ultimately, she "tripped."

Plaintiff suffered "a concussion, a large scalp laceration, and a left wrist fracture." She sued the YMCA and the instructor.

Defendants moved for summary judgment, arguing that (1) they were immune from liability under the Charitable Immunity Act, and (2) plaintiff could not establish a prima facie case of negligence. Plaintiff opposed the motion, arguing that the YMCA was not covered by the Charitable Immunity Act and that summary judgment was premature because discovery was not yet complete.

Continue reading ““Young Man, There’s A Place You Can Go . . .” (But That Place Might Not Be Immune From Liability Under New Jersey’s Charitable Immunity Act If You Later Sue For Injuries You Suffered There)”

Not An Open-Ended Issue: Judge’s Failure To Ask Open-Ended Questions During Voir Dire Is Reversible Error.

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

 Jury (pd)
In 2006 and 2007, the Administrative Office of the Courts issued directives addressing jury voir dires. The directives require, among other things, that trial judges ask jurors at least three open-ended questions that are designed to elicit a narrative response to which "appropriate follow up questions [can] be asked." These questions must be "posed verbally to each juror to  elicit a verbal response." The purpose of this requirement is to "ensure that jurors verbalize their answers so the court, attorneys and litigants can better assess the jurors' attitudes and ascertain any bias or prejudice, not evident from a yes or no response, that might interfere with the ability of that juror to be impartial." The importance of the Administrative Office's directives was highlighted in two recent decision from the Appellate Division, both of which overturned verdicts rendered by jurors who were not asked at least three open-ended questions during voir dire.

In Heredia v. Piccininni, plaintiff sued after being injured in an automobile accident. Before trial, defendant stipulated liability, thus the only issue for the jury was damages. In advance of jury selection, Plaintiff submitted the following open-ended questions to be asked during voir dire:

  1. What are your feelings regarding the proposition that accidents resulting in serious damage to a vehicle may result in no bodily injuries and accidents resulting in little damage to a vehicle may result in serious bodily injuries?
  1. Describe by way of an example an experience in your life that illustrates your ability to be fair and open-minded in this case.
  1. Who are the two people that you least admire and why?
  1. What would you do about the homeless situation?
  1. What would you do about those without medical insurance?

The court did not include any of plaintiff's proposed questions in the list of questions used during voir dire. Instead, the trial judge asked each juror "multiple biographical questions required by the [Administrative Office]," including how they received their news, what their favorite television shows were, what bumper stickers they had on their cars, and how they spent their time. None of these were open-ended questions. Plaintiff's counsel used two of her six peremptory challenges during jury selection and, at the end of the process, advised the court that the jury was satisfactory.

After trial, the jury returned a verdict of no cause on plaintiff's non-economic losses (e.g., pain and suffering damages) but awarded plaintiff her economic damages, representing the full value of her outstanding medical bills. Plaintiff appealed, arguing, among other things, that the trial judge failed to ask any open-ended questions during voir dire.

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Rova Farms – From Born to Run to Bad Faith

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

SpringsteenI am in the middle of reading “Born to Run,” Bruce Springsteen’s memoir. I am about one-third of the way through and so far, so good. I just finished reading about “the only full-scale truly scary bar brawl [of Bruce and the band’s] club lives.” It happened in Rova Farms, a “Russian social club on the outskirts of town.” (In Springsteen’s life, like in his songs, the important things always seem to happen on the outskirts of town.) The brawl started right before the band broke into “Santa Clause is Coming to Town,” and ended with the police being called and several people being taken out on stretchers.

Like nearly all New Jersey lawyers, I know Rova Farms as a thing – a “Rova Farms letter” or a “Rova Farms claim” – not a place. It was interesting to read a story about the place behind the thing. For the uninitiated, Rova Farms Resort v. Investors Ins. Co. of America, was a case involving a visitor to Rova Farms who was injured, not in a bar brawl, but from diving into a shallow portion of a lake on the resort. He sustained serious spinal cord injuries and was paralyzed. The resort’s insurance carrier refused to tender the full, $50,000 policy limit to settle the claim. The case went to trial and the jury returned a $225,000 verdict. The resort then sued its carrier for the full amount of the judgment, alleging that it acted in bad faith by not settling the claim within the policy limits.

The New Jersey Supreme Court agreed, holding that an insurer’s bad-faith failure to settle within policy limits renders it liable for the full amount of the judgment, including any portion in excess of the policy limits. As a result of this decision, defendants in New Jersey will usually send a “Rova Farms letter” to their carriers when a plaintiff offers to settle a case within policy limits. The letter puts the carrier on notice that, if it does not settle within the policy limits, the insured will look to the carrier to pay the entire judgment. Of course, the obligation to do so only arises when the carrier acts in bad faith, but, needless to say, this letter tends to change the dynamic between insured and insurer.   

Back to Bruce . . . As far as New Jersey courts are concerned, Rova Farms is far more popular than Springsteen. The case has been cited more than 3,800 times in New Jersey alone. A search of all state and federal court opinions for Bruce Springsteen yields 87 hits, and only 5 of those are from New Jersey courts. Local hero indeed.