SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-2908-98T2
MORTON GILBERT,
Plaintiff-Respondent,
vs.
ELECTRO-STEAM GENERATOR CORP.,
Defendant-Appellant,
and
JEWISH COMMUNITY CENTER OF GREATER
MONMOUTH COUNTY,
Defendant.
____________________________________
Submitted: January 27, 2000 - Decided: February 10, 2000
Before Judges King, P.G. Levy and Carchman.
On appeal from the Superior Court of New
Jersey, Law Division, Monmouth County.
Avolio & Hanlon, attorneys for appellant
(Robert P. Avolio, on the brief).
Hanna & Anderson, attorneys for respondent
(Robert M. Anderson, on the brief).
The opinion of the court was delivered by
P.G. LEVY, J.A.D.
Defendant, Electro-Steam Corporation (ESC) appeals from
the denial of its motion for an award of counsel fees based on a
claim of frivolous litigation. We conclude the motion judge did
not abuse his discretion in denying fees and affirm for the reasons
expressed by the judge.
The underlying cause of action arose from plaintiff's
claims for damages arising from injuries sustained from a slip and
fall in a steam room located at the premises of the co-defendant,
Jewish Community Center (JCC). As plaintiff was leaving the steam
room, he walked to the edge of the bottom row of seats. When he
extended his left foot towards the floor, his right foot slipped on
the surface of the step, and he fell, striking his extended left
foot against the steam valve located on the vertical riser of the
step about five inches from the floor. His left foot was impaled
on the valve and the bottom of that foot was cut and bleeding
heavily. Fortunately a medical trauma surgeon was among those in
the steam room, and he aided plaintiff.
Plaintiff is an engineer, having graduated from Yale
University. Approximately one year after the accident, plaintiff
perused a buyer's guide known as the Thomas Register "to find out
who made steam baths to find out where steam valves were to be
located." He wrote to ESC and asked for "literature concerning the
necessary equipment and details for installation" of a steam bath.
Upon receipt of ESC's catalogue, he perceived that a particular
diffuser head was similar to that at the JCC. He purchased a
diffuser head and upon comparison, he believed it was "clearly
identical" to the part of the mechanism on which he hurt himself.
It is reasonable to conclude that based on the literature and
inspection of the part, plaintiff thought the diffuser head that
caused his injury was manufactured by ESC.
Plaintiff's complaint alleged ESC was liable on
negligence and products liability theories, but the discovery
process revealed no evidence of ESC's involvement was. The JCC had
no documents relating to its use of ESC equipment. Eventually, JCC
notified ESC that an identification plate attached to the steam
generator installed for its steam room said "Mr. Steam, Model
CU1250, Serial #10889088." On March 4, 1998, counsel for ESC
advised plaintiff that the Mr. Steam generator was involved, and he
requested a voluntary stipulation of dismissal for ESC. Two months
later, ESC made another demand for a stipulation of dismissal and
warned that sanctions would be sought if ESC had to file a formal
motion. A proposed form of certification by ESC's president was
sent to plaintiff, and it plainly stated that ESC did not
manufacture the Mr. Steam product and that ESC had no knowledge of
supplying any parts to the JCC. Plaintiff did not respond to these
requests.
Consequently, ESC filed a motion for summary judgment,
which plaintiff did not oppose. The supporting documents are not
part of the appellate record, but the motion judge specified in the
order granting summary judgment that there was "no ques[tion] of
fact that def[endant] did not manufacture the product in question."
Two months later ESC moved for "attorney fees and costs
resulting from frivolous litigation." Judge Coogan considered the
motion, and after reciting the facts essentially as stated above,
recited the movant's argument that "plaintiff's complaint against
[ESC] was commenced and continued in bad faith and that plaintiff
knew or should have known that the complaint had no reasonable
basis." Defendant sought a counsel fee award of $16,000.
Plaintiff countered by contending it had made "a reasonable mistake
based on the similarity or identicalness of the two valves." The
judge denied the motion, finding plaintiff filed the complaint in
good faith because plaintiff's investigation, while misguided, was
made in good faith.
ESC moved for reconsideration, but the motion was denied
for two reasons: first, because ESC did not raise any new issues
or facts to require reconsideration, Cummings v. Bahr,
295 N.J.
Super. 374, 384 (App. Div. 1996), and second, because the
maintenance of the complaint after ESC called for its dismissal was
not frivolous under N.J.S.A. 2A:15-59.1b.
On appeal, ESC contends the statute is applicable because
"early in the litigation of this case, it became apparent that the
inclusion of Electro-Steam as a defendant in this action was
unsubstantiated and based on guesswork." That assertion is not
borne out by the record, as the first definite notice to plaintiff
that ESC did not manufacture the steam generator installed at the
JCC was in May 1998. It was at that time that ESC first demanded
a dismissal, and the demand was repeated two months later. The
last demand included a proposed certification from ESC's president
detailing the complete lack of connection between ESC and the JCC
steam room. When plaintiff did not reply immediately, ESC filed
its motion for summary judgment twelve days later. Apparently
realizing it had no basis to contradict ESC, plaintiff did not
oppose the motion and it was granted. Two months later ESC sought
sanctions under the frivolous litigation statute.
To show an action frivolous, the moving party must prove,
on the basis of the record, that:
(1) The complaint ... was commenced, used or
continued in bad faith, solely for the purpose
of harassment, delay or malicious injury; or
(2) The nonprevailing party knew, or should
have known, that the complaint ... was without
any reasonable basis in law or equity and
could not be supported by a good faith
argument for an extension, modification or
reversal of existing law.
[N.J.S.A. 2A:15-59.1b.]
Judge Coogan held that the statute applies "where the
continuation of the case becomes so obstinate" but that this case
had not reached that level. Part of the ruling related to the
claim against the co-defendant JCC, and part of it clearly related
to the short time period between the revelation of the complete
lack of connection between ESC and the JCC and the filing of the
motions for summary judgment and for sanctions under N.J.S.A.
2A:15-59.1b. We cannot conclude that Judge Coogan's decision was
an abuse of judicial discretion. Failure to reply to importuning
for a dismissal does not a fortiori correspond to continuance of
the litigation in bad faith.
This case is different from our recent decision in
DeBrango v. Summit Bancorp., ___ N.J. Super. ___ (App. Div. 2000),
where we awarded counsel fees and costs for continuing frivolous
litigation. In the present case, while cessation of the action
against ESC was warranted, plaintiff took no affirmative action to
advance the litigation. In DeBrango, not only did the plaintiffs
reject an offer of judgment and apply for trial de novo after an
arbitrator found no cause of action, but plaintiffs also opposed
defendant's summary judgment motion. Here, we conclude that the
trial judge did not abuse his discretion in determining there was
an absence of bad faith. Accordingly, we affirm the denial of
sanctions under the statute.
Affirmed.