SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-7052-96T2
BEA WARRINGTON,
Plaintiff-Appellant/
Cross-Respondent,
vs.
VILLAGE SUPERMARKET, INC. and
EAST ORANGE CENTER URBAN
RENEWAL ASSOCIATES,
Defendants-Respondents/
Cross-Appellants,
and
THE CONSTRUCTION OFFICIAL OF
THE CITY OF EAST ORANGE
and THE FIRE OFFICIAL OF
THE CITY OF EAST ORANGE,
Defendants.
Argued: September 22, 1999 - Decided: February 24, 2000
Before Judges Muir, Jr., Wallace, Jr., and
Cuff.
On appeal from the Superior Court of New
Jersey, Law Division, Essex County.
David J. Popiel argued the cause for
appellant/cross-respondent (Community Health
Law Project, attorney; Mr. Popiel, of counsel
and on the brief).
Timothy P. Beck argued the cause for
respondent/cross-appellant Village
Supermarket, Inc. (Bivona, Cohen, Kunzman,
Coley, Yospin, Bernstein & DiFrancesco,
attorneys; Mr. Beck on the brief).
Gruen & Goldstein, attorneys for
respondent/cross-appellant East Orange Center
Urban Renewal Associates, joins in the brief
of respondent/cross-appellant Village
Supermarket, Inc.
The opinion of the court was delivered by
CUFF, J.A.D.
In this appeal, we review two orders concerning plaintiff's
application for attorneys' fees. One order declared that plaintiff
had not waived her right to seek attorneys' fees from the settling
defendants. The other order denied the fee application on the
basis that the terms of the settlement did not trigger an
entitlement to attorneys' fees. Defendants appeal from the initial
order; plaintiff appeals from the order denying her fee application
on the merits. We affirm the order finding no waiver but reverse
the order denying the fee application.
On December 30, 1992, plaintiff Bea Warrington filed a
complaint against defendants Village Supermarket, Inc., East Orange
Center Urban Renewal Associates, and the Construction Official of
the City of East Orange, which alleged that the shopping cart
corral of a newly constructed Shop-Rite food market violated the
Handicapped Access Law (HAL), N.J.S.A. 52:32-4 to-10, and its
implementing regulations, the New Jersey Law Against Discrimination
(LAD), N.J.S.A. 10:5-1 to -42, and the Americans with Disabilities
Act (ADA),
42 U.S.C.A.
§§12101 to 12213. Plaintiff sought
compensatory and punitive damages, as well as injunctive relief.
Specifically, she sought revocation of the supermarket's
certificate of occupancy, and removal or modification of the
shopping cart corral which obstructed access to the supermarket for
wheelchair-bound disabled persons. She also sought attorneys' fees
and costs in accordance with the LAD and ADA. An amended complaint
named the Fire Official of the City of East Orange as a defendant.
The record reveals that the shopping cart corral located on
the premises of the supermarket was structured with a series of
posts and metal railings for the purpose of preventing the shopping
carts from being removed from the premises. The configuration of
the corral provided a passage of thirty-two inches in width, too
narrow to allow passage of persons in wheelchairs. The food market
is a public building and subject to the New Jersey Barrier-Free
Construction Law and its regulations, which requires a minimum
thirty-six inch passage to assure accessibility by disabled
persons.
The corral was equipped with a swinging gate designed to
afford handicapped accessibility when the gate was open. However,
the gate was secured with a padlock and a disabled person required
the assistance of an employee to gain access to the building.
Plaintiff contended that it was difficult to get the attention of
an employee and that it "often took a considerable amount of time
and imposed significant inconvenience, especially in inclement
weather."
Prior to the scheduled trial date, the parties settled all
substantive issues. A consent judgment was entered on August 24,
1994. The preamble to the consent judgment provides "that these
parties have agreed upon a settlement of the substantive matters at
issue in this litigation...." The judgment further provides that
defendant Village Supermarkets, Inc. will assure a clear opening
through the corral and dictates the location, width, height and
hours of the opening. It also requires the landlord and the
appropriate municipal officials to enforce the terms of the
judgment. Finally, the judgment provides that "this matter is
dismissed as to all defendants with prejudice."
When the consent judgment was submitted to defense counsel,
the cover letter from plaintiff's counsel referred to the proposed
judgment "ending this litigation as between our clients." Then, in
a letter dated September 2, 1994, plaintiff's counsel forwarded a
copy of the filed consent judgment to counsel and said, "[T]his
brings the substantive aspects of the case to a close. Later this
week I will submit to you a request for attorneys' fees."
On or about March 3, 1995, plaintiff filed a motion to declare
she retained the right to apply for attorneys' fees. In an opinion
dated January 30, 1996, the motion judge declared that plaintiff
had not waived her right to seek attorneys' fees. The motion judge
found that the consent judgment was silent on the issue of
attorneys' fees. However, she analyzed federal cases concerning a
settling party's right to attorneys' fees and determined that a
prevailing plaintiff is entitled to fees absent an express waiver.
Having found plaintiff had not expressly waived her right to seek
attorneys' fees, the motion judge ruled that plaintiff retained her
right to apply for attorneys' fees. The motion judge also held
that R. 4:42-9(d) did not bar the fee application because it did
not expressly require an application for attorneys' fees to be made
prior to final adjudication of the substantive issues.
Furthermore, to the extent the rule would bar such an application,
this case presented special circumstances to relax the rule.
On appeal, defendants argue that the motion judge erred in
finding the consent judgment did not waive plaintiff's right to
apply for attorneys' fees. They contend that plaintiff waived this
right when the judgment was silent on the issue of fees. They
further argue that the motion judge misapplied the law to the facts
of the case. Plaintiff asserts that the failure to refer to
attorneys' fees in the judgment did not relinquish her rights. She
insists that any waiver must be express and unequivocal and that
defendants wrongly assumed that resolution of the substantive
issues included the issue of attorneys' fees.
I
Under the "American Rule," to which New Jersey subscribes, a
prevailing party may not recover counsel fees from the losing
party. Rendine v. Pantzer,
141 N.J. 292, 322 (1995); Van Horn v.
City of Trenton,
80 N.J. 528, 538 (1979). However, such fees may
be awarded when expressly authorized by statute, court rule, or
contractual provision. Department of Envtl. Protection v. Ventron
Corp.,
94 N.J. 473, 504 (1983); In re Thomas,
278 N.J. Super. 580,
584 (App. Div.), certif. denied,
141 N.J. 95 (1995); see also R.
4:42-9(a)(8).
In her complaint, plaintiff invoked both state and federal
statutes, the LAD and the ADA, which allow attorneys' fees to the
prevailing party. N.J.S.A. 10:5-27.1;
42 U.S.C.A.
§12205. The
consent judgment, however, does not contain any provision for
attorneys' fees. The threshold issue, therefore, is whether the
silence of the consent judgment regarding an allowance of
attorneys' fees constitutes a waiver of plaintiff's right to obtain
fees.
A prevailing party's right to attorneys' fees in the face of
a consent judgment which is silent on the issue has generated a
tremendous amount of litigation and disparate rules to resolve the
controversy. In Coleman v. Fiore Bros.,
113 N.J. 594 (1989), the
Court established prospectively one set of rules for cases
involving private counsel and another set of rules for public
interest counsel. In the latter cases, defense counsel may not
insist on a waiver or compromise of statutory fees as a condition
of settlement. Id. at 611. In addition, public interest counsel
have been directed to make defendants and defense counsel aware
during negotiations that a counsel fee will be sought. Ibid. As
to the specific case before it, the Court examined the course of
the negotiations and the settlement documents and concluded that
the failure to reserve the issue in the settlement agreement "would
run counter to the fair expectations of counsel in the conduct of
this case to have surmised that the public policy of New Jersey
forbade such a settlement and dismissal of the action for statutory
fees." Id. at 610. By directing public interest counsel to raise
the issue of their intention to seek fees during discussions with
defense counsel, the Court signaled it will examine the course of
the negotiations and the conduct of the attorneys to determine if
a plaintiff has waived a right to a statutory fee.
A different rule has developed in the federal courts, notably
within the Third Circuit. Since 1984, the Court of Appeals for the
Third Circuit has held that waiver of a statutory fee will not be
presumed in the face of a consent judgment which does not address
attorneys' fees. Rather, a prevailing party will be entitled to an
attorneys' fee unless the settlement agreement expressly and
specifically waives that right. Torres v. Metropolitan Life Ins.
Co.,
189 F.3d 331, 333-34 (3d Cir. 1999); El Club Del Barrio, Inc.
v. United Community Corps.,
735 F.2d 98, 99 (3d Cir. 1984).
Further, a settlement agreement that is silent as to attorneys'
fees will not be deemed a waiver, regardless of the course of
negotiations. Torres, supra; Ashley v. Atlantic Richfield Co.,
794 F.2d 128, 139 (3d Cir. 1986); El Club Del Barrio, supra, 735 F.
2d
at 100. The bright-line rule of an express and specific waiver of
fees adopted by the Third Circuit establishes uniformity of
decision and furthers the United States Supreme Court rule that
prevailing plaintiffs should recover attorneys' fees as authorized
by statute "unless special circumstances would render such an award
unjust." Newman v. Piggie Park Enters., Inc.,
390 U.S. 400, 402,
88 S. Ct. 964, 966,
19 L. Ed.2d 1263, 1265-66 (1968).
Here, plaintiff founded her right to relief under state law,
the LAD, and federal law, the ADA. Although the consent judgment
does not refer to either statute, the relief obtained by plaintiff
vindicates the rights expressly secured by the ADA.See footnote 11 We need not
consider whether the course of negotiations and counsel's failure
to follow the procedure announced in Coleman barred plaintiff's fee
application. As noted, Coleman governs cases filed in state court
seeking relief solely under a state statute allowing fee-shifting.
Here, because the ADA is implicated, we elect to apply the rule
governing settlement of cases in federal court brought under
federal statutes which provide for fee-shifting.
Applying the bright-line rule followed by the Court of Appeals
for the Third Circuit, it is apparent that plaintiff did not waive
her right to apply for an award of attorneys' fees. The consent
judgment does not address attorneys' fees at all. It certainly
does not contain an express and specific waiver of attorneys' fees.
Thus, we hold that plaintiff did not waive her right to apply for
an attorneys' fee and Judge Loftus' February 22, 1996 order is
affirmed.
Having decided that the consent judgment did not waive plaintiff's right to apply for an attorneys' fee, we turn to the question of whether plaintiff is a prevailing party. The second motion held that plaintiff was not entitled to fees because there was no finding or admission that defendants had violated the LAD and/or ADA. We are satisfied that this analysis of plaintiff's right to fees is inconsistent with governing law.
The test for determining whether a party is prevailing and entitled to receive an award of attorneys' fees is similar for state and federal fee-shifting statutes. Entitlement to attorneys' fees is predicated on the relationship between the relief sought and the relief obtained. Institutionalized Juveniles v. Secretary of Pub. Welfare, 758 F.2d 897, 911 (3d Cir. 1985); Singer v. State, 95 N.J. 487, 495, cert. denied, 469 U.S. 832, 105 S. Ct. 121, 83 L. Ed.2d 64 (1984). A plaintiff is considered a prevailing party "when actual relief on the merits of [the] claim materially alters the relationship between the parties by modifying the defendant's behavior in a way that directly benefits the plaintiff." Farrar v. Hobby, 506 U.S. 103, 111-12, 113 S. Ct. 566, 573, 121 L. Ed.2d 494, 503 (1992); see also Metropolitan Pittsburgh Crusade for Voters v. City of Pittsburgh, Pa., 964 F.2d 244, 250 (3d Cir. 1992) (a "'plaintiff must be able to point to a resolution of the dispute which changes the legal relationship between itself and the defendant'") (citation omitted); New Jersey Citizen Action v. The Riviera Motel Corp., 296 N.J. Super. 402, 417-18 (App. Div. 1997) (a party is prevailing if it succeeds in obtaining a result that alters or affects defendant's behavior toward plaintiff), appeal dismissed, 152 N.J. 361 (1998); Bolyard v. Berman, 274 N.J. Super. 565, 581 (App. Div.) (plaintiff is prevailing when the legal relationship between the parties is modified or defendant's behavior is altered in a way which directly benefits the plaintiff), certif. denied, 138 N.J. 272 (1994).
In Singer, supra, the Court expressed the test for prevailing party as follows:
The test, as noted, first calls for a factual nexus between plaintiff's litigation and the relief ultimately achieved.... Second, under NadeauSee footnote 22, it must be shown that the relief ultimately secured by plaintiffs had a basis in law.
[95 N.J. at 495.]
The form of the judgment is not entitled to conclusive weight.
Ross v. Horn,
598 F.2d 1312, 1322 (3d Cir. 1979), cert. denied,
448 U.S. 906,
100 S. Ct. 3048,
65 L. Ed.2d 1136 (1980); Bolyard,
supra, 274 N.J. Super. at 581. Rather, a court must determine
whether the plaintiff's "'lawsuit acted as a catalyst which
prompted [defendants] to take action' to correct the unlawful
practice." N.A.A.C.P. v. Wilmington Med. Ctr., Inc.,
689 F.2d 1161, 1167 (3d Cir. 1982) (citation omitted), cert. denied,
460 U.S. 1052,
103 S. Ct. 1499,
75 L. Ed.2d 930 (1983); Jackson v.
Georgia-Pac. Corp.,
296 N.J. Super. 1, 23 (App. Div. 1996), certif.
denied,
149 N.J. 141 (1997).
In reviewing the relief obtained, a prevailing party need only
be nominally successful. Prevailing on "'any significant issue ...
which achieves some benefit ... sought in bringing suit'" will
suffice. Hensley v. Eckerhart,
461 U.S. 424, 433,
103 S. Ct. 1933,
1939,
76 L. Ed.2d 40, 50 (1983) (citation omitted); New Jersey
Citizen Action, supra, 296 N.J. Super. at 417. "[T]he magnitude of
the relief obtained" is irrelevant; an award of nominal damages is
sufficient to constitute a party as prevailing. Farrar, supra, 506
U.S. at 112-14, 113 S. Ct. at 573-74, 121 L. Ed.
2d at 503-04;
Connell v. East River Sav. Bank,
285 N.J. Super. 351, 364 (App.
Div. 1995), certif. denied,
144 N.J. 378 (1996). The Third Circuit
has held that if plaintiff succeeds in "'moving the defendant to do
more than it was already committed to do,' she will be deemed to
have prevailed." Ashley, supra, 794 F.
2d at 136 (quoting Disabled
in Action of Pa. v. Pierce,
789 F.2d 1016, 1020 (3d Cir. 1986));
New Jersey Citizen Action, supra, 296 N.J. Super. at 417-18.
Furthermore, it is immaterial whether there was a "full litigation
of the issues." Maher v. Gagne,
448 U.S. 122, 129,
100 S. Ct. 2570, 2575,
65 L. Ed.2d 653, 661 (1980); Singer, supra, 95 N.J. at
495; Girandola v. Borough of Allentown,
208 N.J. Super. 437, 441-42
(App. Div. 1986). When an action ends in settlement conferring
relief sought, a prevailing plaintiff's claim for attorneys' fees
is not relinquished. Ashley, supra, 794 F.
2d at 132; Girandola,
supra, 208 N.J. Super. at 442.
Further, it is immaterial that plaintiff received only some of
the relief requested. In Hensley v. Eckerhart, supra, the Supreme
Court held:
[it is not] necessarily significant that a
prevailing plaintiff did not receive all the
relief requested. For example, a plaintiff
who failed to recover damages but obtained
injunctive relief, or vice versa, may recover
a fee award....
[Hensley, supra, 461 U.S. at 435 n.11, 103 S.
Ct. at 1940 n.11, 76 L. Ed.
2d at 52 n.11;
Singer, supra, 95 N.J. at 493-94.]
This State follows the same rule.
In H.I.P. v. Hovnanian at Mahwah VI, Inc.,
291 N.J. Super. 144
(Law Div. 1996), a physically challenged plaintiff brought suit
against a real estate developer for alleged violations of various
statutes, including the LAD and the ADA. Id. at 153-54. After
defendant agreed by way of settlement to modify condominium units
to make them accessible to handicapped persons, plaintiff moved for
attorneys' fees. Ibid. Although plaintiff procured a settlement
which provided only injunctive relief, the court held:
It is of no moment that the changes, when
actually implemented by [defendant], were
minor. Plaintiff represented the interests of
the physically challenged to whom issues such
as the wheelchair-turning radius in a
bathroom, and whether the doors swing into or
out of a room, are very important.
[H.I.P., supra, 291 N.J. Super. at 155.]
Here, the motion judge held that plaintiff could not recover
attorneys' fees because the relief obtained was not founded in a
law which provided for attorneys' fees. In reaching this decision,
he confined his review to the express terms of the consent judgment
which referenced the HAL and regulations adopted pursuant to the
statute. We conclude that the motion judge's evaluation of
plaintiff's right to fees was too narrow.
Plaintiff's complaint sought relief under the LAD, the ADA,
and the HAL. The HAL does not contain a fee-shifting provision;
however, the ADA and the LAD contain such provisions.
Unquestionably, plaintiff's complaint was the catalyst for securing
the relief she obtained. The barrier erected by defendants is not
only condemned by the HAL and its regulations but is also
encompassed by the prohibitions of the ADA and the LAD.
Accordingly, plaintiff was a prevailing party as a matter of law.
III
Finally, we address whether R. 4:42-9(d) precludes plaintiff's
fee application. The rule provides:
An allowance of fees made on the determination
of a matter shall be included in the judgment
or order stating the determination.
[R. 4:42-9(d).]
This rule reflects that a matter is not concluded until an allowed
fee has been determined. See Urban League of Greater New Brunswick
v. Mayor and Council of Borough of Carteret,
115 N.J. 536, 546-47
n.2 (1989).
The rule has been interpreted as requiring the application to
be made either before entry of final judgment or within ten days
thereafter by a motion to alter or amend the judgment. Czura v.
Siegal,
296 N.J. Super. 187, 190 (App. Div. 1997). A motion
pursuant to R. 4:50-1 from relief of order or judgment may also be
appropriate.
Plaintiff's counsel followed neither course. He filed a
motion in May 1995, six months after entry of the consent judgment,
without reference to any rule, for a determination that plaintiff
had not waived her right to apply for an attorneys' fee award. If
the right to a fee derived solely from a state rule or statute, R.
4:42-9(d) would bar the application. We hesitate to apply this
rule to this situation, however, because plaintiff's right to
attorneys' fees is derived not only from a state statute but also
a federal statute. To apply this rule to this case could operate
to diminish the federal right to barrier-free access to public
facilities. Cf. Felder v. Casey,
487 U.S. 131, 140,
108 S. Ct. 2302, 2308,
101 L. Ed.2d 123, 139 (1988) (state notice-of-claim
provisions are inapplicable to civil rights actions founded on
federal statute); Fuchilla v. Layman,
109 N.J. 319, 332-38, cert.
denied sub nom, University of Medicine & Dentistry of New Jersey v.
Fuchilla,
488 U.S. 826,
109 S. Ct. 75,
102 L. Ed.2d 51 (1988)
(notice of claim provisions do not apply to discrimination claim
founded on federal and state law). Although counsel's course is
not condoned, under these circumstances, the rule should not be
applied to bar the fee application. As a result of this
disposition, we remand this matter to the Law Division for
consideration of plaintiff's fee application.
The February 22, 1996 order is affirmed; the July 1, 1997
order is reversed and the matter is remanded.
Footnote: 1 1
42 U.S.C.A.
§12182(a) provides:
No individual shall be discriminated against on the
basis of disability in the full and equal enjoyment
of the goods, services, facilities, privileges,
advantages, or accommodations of any place of
public accommodation by any person who owns, leases
(or leases to), or operates a place of public
accommodation.
42 U.S.C.A.
§12182(a)(2)(A) provides:
For purposes of subsection (a) of this
section, discrimination includes _
* * *
(iv) a failure to remove architectural barriers,
... in existing facilities, ... where such removal
is readily achievable;...
In addition, N.J.A.C. 13:13-4.2(a) provides:
It shall be unlawful for any person to refuse, withhold from or deny an individual, either directly or indirectly, on account of a handicap, access to any of the accommodations, advantages, facilities or privileges of a place of public accommodation. It shall be unlawful for any person to discriminate against a handicapped person in the price, terms, or conditions upon which access to such accommodations, advantages, facilities or privileges may depend. Footnote: 2 2Nadeau v. Helgemoe, 581 F.2d 275 (1st Cir. 1978).