Despite Girsh v. Jepson, A District Court Need Not Always Determine the Best Potential Recovery in Order to Approve a Class Action Settlement

Halley v. Honeywell International, Inc., ___ F.3d ___ (3d Cir. 2017).  This was an environmental contamination class action involving lands in Jersey City, New Jersey.  After “five years of extensive fact discovery produced little evidence that liability could be established,” plaintiffs and defendant Honeywell agreed to settle the case for $10,017,000.  (There is another defendant, […]

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“Learned Professional” Exception to Consumer Fraud Act Exempts Providers of Ambulance Services

Atlantic Ambulance Corp. v. Cullum, ___ N.J. Super. ___ (App. Div. 2017).  In her first published opinion for the Appellate Division since her elevation, Judge Mayer today addressed consolidated putative class action cases asserting Consumer Fraud Act (“CFA”) and other claims (actually, counterclaims, as discussed below) against an ambulance service provider, Atlantic.  One putative class […]

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A Rainbow by Any other Name-Legal Name Change Granted for Transgender Child

In a case of first impression in New Jersey, I was privileged to represent the mother and custodial parent of a transgender child in a contested, but successful, application for  the child’s legal name to be changed to the name which more accurately reflects the gender with which he identifies.  The case, Sacklow v. Betts,  has resulted in a reported decision (precedential) and gives guidance for judges who will no doubt be addressing these issues in the future.

Janet Sacklow retained counsel to represent her in connection with various issues surrounding her child’s gender identity issues.  This included treatment for hormones, mental health services, and allowing the child to assume the name of Trevor Adam. The child’s father had objected to various applications over the years related to the child’s gender identity, and initially objected to this as well, asking that the child’s given name, Veronica, continue.  During the trial in the matter, the father seemingly changed his mind, while at the same time expressing concerns that a name change was not in the child’s best interests.  Given the history of the father taking inconsistent positions in connection with the child, it was requested that the court make an independent finding as to the application for a name change.

The court found that the standard that should be used when there is a request for a name change when a child is transgender is whether or not the name change is in the child’s best interests.  However, the court then went on the note factors which should specifically be considered by a judge making such a decision.  Those factors are:

(1) The age of the child; (2) The length of time the child has used the preferred name; (3) Any potential anxiety, embarrassment or discomfort that may result from the child having a name he or she believes does not match his or her outward appearance and gender identity; (4) The history of any medical or mental health counseling the child has received; (5) The name the child is known by in his or her family, school and community; (6) The child’s preference and motivations for seeking the name change; (7) Whether both parents consent to the name change, and if consent is not given, the reason for withholding consent.

In this case, the child had disclosed the fact that he identified as male several years previously.  He had been under the care of health care providers for a significant amount of time and was confident in his gender identity.  He was known as Trevor in school, to his friends, and to the vast majority of his family.  He was treating with Children’s Hospital of Philadelphia and was in the process of his mental and physical transition to male.  He was shortly going to obtain a drivers’ license, and the idea of having a picture that did not “match” his name caused him significant stress. The court, which had taken testimony from both parents as well as the child, unequivocally concluded that it was in the child’s best interests to have his name changed.

The law relating to gender identity, sexual orientation and associated issues is constantly changing and developing. This case provides litigants and their counsel guidance in an emerging are of the law that will likely be addressed by courts in this and other jurisdictions.

Jennifer Weisberg Millner is a partner in Fox Rothschild LLP’s Family Law Practice Group. Jennifer is resident in the firm’s Princeton Office, although she practices throughout the state. Jennifer can be reached at 609-895-7612 or jmillner@foxrothschild.com.

 

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Newark Airport Bars May Soon Be Open After Hours

Travelers at the Newark Liberty International Airport may soon be able to imbibe in adult beverages after hours. Legislation expanding the hours the airport is allowed to serve alcohol was unanimously approved by an Assembly panel. Bill A-2419 would allow bars and restaurants operating within an international airport to sell alcoholic beverages between the hours of 8 am and 4 am.

Usually, local municipalities establish by ordinance the hours when alcoholic beverages may be sold for consumption on the premises. Most other bars and restaurants in New Jersey must close at 2 am or 3 am. Newark Airport is currently regulated by the liquor laws of the City of Newark, which allow the sale of liquor in bars and restaurants in the airport from 9:00 am to 2:00 am Monday through Wednesday, from 9:00 am to 3:00 am Thursday through Saturday, and from noon to 2:00 am on Sundays. This bill would only affect Newark International Airport.

The bill’s chief sponsor, Assemblyman Timothy Eustace, noted that the extended hours are appropriate for the airport, where normal day-to-day time routines do not apply. Another sponsor, Assemblywoman Eliana Pintor Marin stated that the bill is a “revenue generator and job booster.” Assemblyman John Burzichelli noted that for travelers, time is relative. “Someone’s morning may be someone else’s evening.”

The bill was approved by the Assembly Regulatory Oversight and Reform and Federal Relations Committee. It now goes before the legislature and if passed, to the governor for his approval. It would take effect immediately upon enactment.

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33 Years Since Kelly v. Gwinnell Introduced Social Host Liability

On June 27, 1984, the Supreme Court decided Kelly v. Gwinnell, 96 N.J. 538 (1984).  There, Chief Justice Wilentz, writing for a 6-1 majority (Justice Garibaldi was the lone dissenter), announced a new rule of law regarding the liability of social hosts who serve alcohol to those who then get into an auto accident caused […]

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Literal Reading of Police and Fire Public Interest Arbitration Reform Act on Applicability of Cap on Arbitration Awards Would Yield Absurd Results, so the Appellate Division Rejects That Outcome

In re State of New Jersey and Fraternal Order of Police Lodge 91, ___ N.J. Super. ___ (App. Div. 2017).  In her opinion for the Appellate Division today, Judge Reisner entered the competition for the most concise opinion of the current term, rivaling Judge Espinosa’s opinion in Jiwungkul v. Director, Div. of Taxation, ___ N.J. […]

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What Happens if a Divorce Goes to Trial?

Many people contemplating divorce do not realize that if they are unable to reach a settlement, the result is a full trial before a judge of the Superior Court of New Jersey.

It is critical to understand what occurs during a divorce trial – and what does not occur – and to be prepared.

First, a trial is not is not like a television drama or reality show. It is a highly structured event, subject to state laws and local rules. Witnesses testify and documents such as financial statements, appraisals, and other records are entered into evidence as exhibits, subject to the New Jersey Rules of Evidence. Not all evidence or testimony is admissible as evidence at trial. The most common example is hearsay testimony; that is, testimony concerning a statement made outside of court that is being offered for the truth of the statement. For example, a mother may want to testify about something her daughter told her about her father. Although there are a variety of exceptions to the hearsay rule which may allow hearsay testimony to be admitted, the judge will adhere to the Rules of Evidence in making that determination. If the judge decides that a statement is hearsay, and no exception applies, he or she may not admit it into evidence or to allow you to refer to it at trial.

Secondly, it is an understandable misconception on the part of divorce litigants to believe that their spouse’s infidelity or other wrongdoing, will impact the outcome of their divorce case. However, New Jersey law is clear that except in egregious circumstances, marital fault is not a factor in decisions relating to alimony, child support, and division of marital assets. Therefore, the courtroom is not a soapbox to air one’s grievances. Testimony and exhibits concerning fault may be deemed irrelevant as to certain issues. It should be added that in custody cases, fault may be considered but only to the extent that it bears upon parental fitness.

Finally, in a divorce trial the judge decides what the facts are, as opposed to a jury. The judge then applies his or her factual findings to the law to make decisions on the issues in the case. The credibility of the parties and witnesses can factor into this decision-making process. Often there are diverging viewpoints about events which occurred in the past, as well as the current situation. A judge faced with varying and possibly conflicting accounts of parties and witnesses must make factual findings in order to decide the issues. A judge will base his factual findings in part on credibility determinations – that is, which party appears more believable and offers the more believable version of the facts presented. The judge can form a favorable (or unfavorable) impression of a party or witness based upon conduct in the courtroom, and may consider conduct aside from what is observed while the party or witness is on the witness stand. The judge is given wide latitude in determining a person’s credibility and demeanor while testifying, which may prove significant.

In conclusion, a divorce trial is serious business. Maintain your composure at all times in the courtroom. Use an attorney who has trial experience and listen to your lawyer. Testify truthfully and accurately, and understand what the judge can and cannot take into consideration when rendering his or her decision. Most of all, be prepared before entering the courtroom.

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Should I Have an Arbitration Clause in My Construction Contract?

Although it is typical for AIA form contracts to contain arbitration clauses, as a contractor you should consider whether you should have an arbitration clause in your construction agreement. As discussed below, there are numerous factors to consider in determining whether mandatory arbitration is the preferred dispute resolution mechanism, or whether the state court system is preferred. Although arbitration may have some advantages, there are also disadvantages which must be considered rather than simply adopting the AIA form.

Costs of the Arbitration Proceeding

If an action is filed in either state or federal court, there is a filing fee for the complaint which is typically not more than $250 if you are the plaintiff. If you are the defendant, the filing fee is somewhat less. In a commercial arbitration matter, however, the amount of the filing fee paid by the claimant depends upon the monetary value of the claim being filed. In general, the higher the dollar value of the claim, the higher the filing fee for the claimant. If you are the respondent in an arbitration proceeding, no filing fee is charged unless you intend to pursue a counterclaim. As such, compared to a state court matter, the filing fee in an arbitration proceeding is substantially higher, and perhaps exponentially higher, if it involves a substantial claim. Thus, the initial filing fees in an arbitration proceeding are more costly than a state court action.

Judge or Jury vs. Arbitrator(s)

When an action is filed in a commercial arbitration matter, the parties must select an arbitrator, or a panel of arbitrators, to decide their matter – depending upon the size or complexity of the claim. In a state court proceeding, either a judge or jury will decide the matter on the merits. In the context of an arbitration proceeding, arbitrators are compensated their normal hourly rates throughout the course of the arbitration proceeding. In general, these rates are commensurate with the level of experience of the arbitrator and can surpass $500 to $800 per hour. This billable time includes all prehearing time, which can be extensive, if the value of the claims are substantial. Thus, the fees which are payable to an arbitrator are substantial and must be paid by both the claimant and the respondent. In a typical state court proceeding, the parties are not required to compensate the judge or jury for any pre-trial time or trial time. Therefore, the costs associated with an arbitration proceeding, both during the prehearing stage and during the hearing stage, are substantially greater.

Furthermore, if a party to an arbitration proceeding wishes to obtain a transcript of the proceeding, he or she is required to pay a court reporter to be present to record the proceedings. In either forum, a claimant or plaintiff will need to decide whether they feel comfortable with a judge or jury deciding the case, or an arbitrator or a panel of arbitrators. While arbitrators may be trained legal professionals, there is no guarantee that they possess superior knowledge to a judge, who may also possess extensive experience in construction litigation. Obviously, a jury is an entirely different matter and requires laymen to decide the merits of the case. With that being said, however, at times the decisions of an arbitrator or a panel of arbitrators can seem equally confusing or unreasonable.

Discovery During an Arbitration Process vs. State Court Process

In arbitration matters, interrogatories, document requests, and depositions are generally limited. In fact, in some proceedings, other than exchanging documents, no additional discovery is permitted. The extent of discovery which is permitted, however, is entirely within the discretion of the arbitrator.

On the other hand, in a state court proceeding the parties are free to serve interrogatories, document requests, requests for admissions and other discovery vehicles. They are also able to take as many depositions as are reasonably necessary. As such, the discovery process in a state court proceeding is generally more extensive and costly than would occur in a typical arbitration proceeding. This conclusion, however, assumes that the arbitrator does not permit the same amount of discovery that would be permitted in a state court action. As a caveat, at times an arbitrator may permit extensive discovery, and thus, the cost savings would be lost. In general, an arbitration proceeding does save the parties money in the discovery process, however, less extensive discovery can leave a party feeling somewhat ambushed as they may not be fully aware of the merits of their adversary’s claims prior to the hearing.

Timeliness of the Proceeding

In general, arbitration proceedings are resolved faster than state court actions. It is not unusual for a state court case to take a minimum of two to four years before a trial is heard. On the other hand, it is unusual for an arbitration proceeding to go on beyond one year, unless the claim is extensive or complex. Depending upon whether you are the claimant or the respondent, the timeliness of the resolution may or may not benefit you. Nonetheless, an arbitration proceeding tends to move significantly faster to a hearing on the merits than a state court action.

Judgments

Once a judgment is obtained in an arbitration proceeding, an action still must be filed with the state court to confirm the judgment. The judgment will be confirmed by the state court unless a party can demonstrate that there was a miscalculation made by the arbitrator, or that the arbitrator rendered an award on an issue not before him which was outside the scope of the demand for arbitration. Also, if an award is so poorly written and unclear that its terms require further verification, the state court may ask the arbitrator to correct or modify the award. On the other hand, once a judgment is entered in a state court proceeding, that judgment is immediately valid. In either matter, once a judgment is confirmed or entered by a state court, the parties may commence executing upon the judgment.

Appeals from an Arbitration Proceeding or a State Court Proceeding

Appealing the decision of an arbitrator is much more than difficult than appealing the decision of a state court matter. In general, in order to obtain a reversal of a decision rendered by an arbitrator, the party would have to demonstrate fraud or undue means by either a party to the arbitration, or partiality by the arbitrator, or a patent excuse of discretion by the arbitrator which prejudices one side. As such, the grounds to appeal an arbitrator’s decision are narrow. On the other hand, while a state court proceeding is simpler to appeal, the party must nonetheless demonstrate that a reversible error was made by the trial court in order to succeed on an appeal. In the absence of a clear error of the law, or other prejudicial error by the state court, the judgement entered by the state court will be affirmed by the Appellate Division.

Conclusion

Although an arbitration clause appears in most AIA form contracts, contractors should consider whether they should the strike this clause and simply allow parties to proceed in state court. Whether a contractor should include an arbitration clause is an issue the contractor should discuss with their counsel, or an attorney from a reputable firm who has knowledge in this area. In my experience, at times an arbitration clause is not preferred. Furthermore, depending on the nature of the case, an arbitration proceeding may be too abbreviated or more costly. For the foregoing reasons, a contractor should consult with an attorney as to whether to include an arbitration clause in their construction agreement because once the clause is included in the agreement, it is binding unless both parties elect to void the provision.

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DEP Has the Power to Condemn Property, Take Perpetual Easements to Protect the Shore, and Allow Public Access to Easement Areas

State of New Jersey, Department of Env. Protection v. North Beach 1003, LLC, ___ N.J. Super. ___ (App. Div. 2017).  Beach access has long been an important and controversial issue in New Jersey.  After Superstorm Sandy in 2013, the New Jersey Department of Environmental Protection (“DEP”) partnered with the federal Army Corps of Engineers, pursuant […]

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“Reasonable Expectations of the Insured” Did Not Defeat Clear Policy Exclusion of “Insured vs. Insured” Claims

Abboud v. National Union Fire Ins. Co., ___ N.J. Super. ___ (App. Div. 2017).  This opinion by Judge Ostrer interpreted an “insured vs. insured” exclusion in a directors and officers liability insurance policy.  That exclusion generally bars coverage for claims by one insured against another, such as counterclaims brought against plaintiff by his fellow officers […]

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OPRA Covers Electronically Stored Information, Including Fields in E-Mails

Paff v. Galloway Tp., ___ N.J. ___ (2017).  In this OPRA case, as discussed here, plaintiff sought to obtain copies of fields in e-mails sent by the Galloway Township Clerk and the Township’s Police Chief during a two-week period in 2013.  Plaintiff did not seek the e-mails themselves, but only the “sender,” “recipient,” “date,” and […]

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Plaintiffs’ Creative Arguments Did Not Overcome the Language of Insurance Policies That Precluded Coverage

Gil v. Clara Maass Medical Center, ___ N.J. Super. ___ (App. Div. 2017).  This was a medical malpractice case.  The appeal, however, resulted from the Law Division’s grant of summary judgment in favor of certain insurers, which threw out plaintiff’s claim that the allegedly negligent physician, Dr. Copur, was the covered hospital’s “employee” or a […]

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Standing, Attorneys’ Fees, Disability, and Search and Seizure: The Latest Cases for the Supreme Court

The Supreme Court has granted review in four more cases.  In Cherokee LCP Land, LLC v. City of Linden Planning Bd., the question presented, as phrased by the Supreme Court Clerk’s Office, is “Do plaintiffs have a sufficient interest in the property adjacent to the property to be developed (the development property), such that they […]

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State Comptroller Need Not Give Reasons for Auditing Local Government Units

Larkins v. Solter, ___ N.J. Super. ___ (App. Div. 2017).  The Office of the State Comptroller (“OSC”) was established by the Legislature in 2007, in order to subject governmental financial activities to uniform, meaningful, and systematic public scrutiny.  N.J.S.A. 52:15C-1 et seq.  Among the OSC’s powers is the ability to audit, among other agencies, units […]

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3 Things to Know about DUIs this Summer

Summer has arrived, and with it comes the season where the most DUI’s occur. People who are looking for a criminal lawyer in Flemington, NJ will be pleased with the dedication that we put into each case for our clients.

No Attorneys’ Fees Under OPRA Where Requested Documents Were Produced Before OPRA Lawsuit Was Filed

Stop & Shop Supermarket Co., LLC v. County of Bergen, ___ N.J. Super. ___ (App. Div. 2017).  The Open Public Records Act, N.J.S.A. 47:1A-1 to -13 (“OPRA”), permits suits for access to public records covered by OPRA.  A successful OPRA litigant is entitled to attorneys’ fees.  But can an OPRA plaintiff sue and get fees […]

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Condominium Association Cannot Collect Unpaid Fees from Lender’s Assignee

On June 6, 2017, the New Jersey Appellate Division ruled that a foreclosing mortgagee is not liable for unpaid condominium maintenance fees simply because it winterized the unit and changed the locks.

In the published decision Woodlands Community Association Inc. v. Mitchell, the Appellate Division reversed a trial court verdict in favor of the condominium association. The three-judge panel went onto offer guidance as to what specifically constitutes a “mortgagee in possession” of a property, a determination the judges noted required a case-by-case approach.

In this case, the lender’s assignee, defendant Nationstar Mortgage LLC, took possession of a condominium unit when the owner/mortgagor defaulted on the loan. It then winterized the unit and changed the locks. The unit owner also owed the condominium association for unpaid monthly fees and other condominium assessments. The condominium association instituted an action against the owner to recover the unpaid fees. Thereafter, the association amended its complaint to include defendant, alleging that the lender’s assignee was responsible for the association fees as it was in possession of the property.

The trial court found in favor of the association, determining that defendant was a mortgagee in possession, and therefore, liable for the maintenance fees. The trial judge reasoned that defendant held the keys, and no one else could gain possession of the property without its consent. This, the trial court held, constituted exclusive control, giving defendant the status of mortgagee in possession.

On appeal, defendant argued that changing the locks and winterizing the condominium unit did not render it a mortgagee in possession of the property.

The actions of a mortgagee determine whether possession and management of the premises have been undertaken by it. After considering case law addressing the definition of a “mortgagee in possession,” the appellate panel assessed “whether defendant exercised the necessary level of control and management over the property to deem it a mortgagee in possession.”

The panel found that the minimal efforts taken by defendant to secure its interest in the mortgaged property were not sufficient to convert it into a mortgagee in possession. Thus, defendant was not liable to the condominium association for the unpaid fees.

The panel explained that where a mortgagee has not occupied the unit, is not collecting rents or any other profits, nor making repairs, it will not be considered a “mortgagee in possession” responsible for paying condominium fees and dues. Winterizing the property and changing the locks is not the “equivalent of the multitude of actions and responsibilities undertaken by” a mortgagee in possession.

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Wiretapping in the Workplace

The recent turmoil, investigation and controversy surrounding President Donald Trump’s firing of former FBI Director James Comey has thrust the issue of wiretapping into the public and political spotlight. “James Comey better hope that there are no ‘tapes’ of our conversations before he starts leaking to the press!,” President Trump tweeted on May 12, 2017, suggesting that “tapes” of his private conversations with Director Comey might exist. Most recently, the White House, responding to bipartisan criticism, has been pressed to divulge whether there really are any secret recordings of the president’s private conversations with the former FBI Director. Time will tell whether the Trump Administration comes clean and whether any recordings actually do exist (and, if so, what the implications might be).

All of this commotion prompted me to think about wiretapping in the workplace and, specifically, the issue of audio recordings or, as President Trump has expressed, “tapes” of conversations secretly recorded by an employer of its employees. What types of audio or tape recordings are legally permitted in the employment environment?

There are three primary sources of legal authorities governing the issue of workplace monitoring: the federal Electronic Communications Privacy Act, which encompasses both the Wiretap Act and Stored Communications Act, 18 U.S.C. § 2510, et seq.; state statutes prohibiting or regulating such surveillance; and common law protections against the invasion of privacy. Depending on the situation, any one or all three of these bodies of law might apply.

The unlawful recording of telephone calls at the federal level is governed by the Electronic Communications Privacy Act, which provides that an employer may not record telephone conversations unless one of two exceptions applies. The first exception is the consent exception, which allows an employer to monitor or intercept employee communications so long as the employee consents to the surveillance. The issue of consent is generally satisfied, or is at least implied, where an employee is notified that his/her calls are being recorded, or has expressly given consent pursuant to an employment contract or company policy. To demonstrate or obtain an employee’s consent, employers should notify and forewarn their employees that their calls may be recorded, and that they have a limited expectation of privacy in the workplace.

The second exception to the prohibition against intercepting oral communications under the federal Wiretap Act is known as the “business extension” or “business use” exception. To satisfy this exception, there are two requirements: wiretapping is allowed (i) when the oral communication is recorded or intercepted through a device furnished to the subscriber or user by a provider of wire or electronic communication service in the ordinary course of its business; or (ii) being used by the subscriber or user in the ordinary course of its business. Employers may engage in the legal surveillance of oral telephone communications if they do it in the ordinary course of their business. This exception is particularly important to employers who maintain telemarketing or customer service operations because of their interest in ensuring quality control. Beyond the telemarketing industry, under federal law, when an employee uses an employer’s telephone systems, the employer generally may monitor, intercept, and record the employee’s conversations without the employee’s consent so long as the employee’s call is work-related. Also, an employer’s need to protect trade secrets or ensure compliance with non-compete agreements ordinarily will justify the surveillance of an employee’s calls. Similarly, when an employer has a reasonable suspicion that an employee is engaged in misconduct or violating company policy, the employer normally can justify the recording of an employee’s work-related calls. Employers also generally enjoy greater latitude in recording employee conversations and monitoring employee calls from telephones designated for business use only.

Still, under federal law, the surveillance of an employee’s telephone calls is not absolute. An employer’s surveillance of an employee’s personal phone calls beyond the point of determining whether the call is work-related (or not) is generally considered to be outside “the ordinary course of business,” and thus prohibited by the Wiretap Act. Furthermore, an employer’s general policy of monitoring employee calls does not by itself legitimize the wholesale surveillance of employee calls or establish that all calls occur in the ordinary course of business. Rather, each act of surveillance is scrutinized to ensure the wiretapping was reasonably business-related.

Employers also must be mindful of state-specific law before recording employee calls. Most states require that at least one party to a conversation consent to the recording of the conversation for such recording to be lawful. In other words, in “one-party” states where the consent of one party is required, an employer can record a conversation with its employee so long as the employer is a party to the conversation. For example, in New Jersey, it is not unlawful for an individual who is a party to (or has consent from a party to) an in-person or electronic communication to record and/or disclose the content of said communication unless the person is doing so for the purpose of committing a tortious or criminal act. N.J.S.A. 2A:156A-4(d). Similarly, the federal Wiretap Act is a one-party consent statute.

There are several states, however, that require the consent of both parties before a call can be lawfully recorded. California law, for example, requires parties to a conversation to be notified, either by a recorded message or a beep, that the conversation is being recorded or monitored. Pennsylvania’s wiretapping law likewise is a “two-party consent” law, making it a crime to intercept or record a telephone call or conversation unless all parties to the conversation consent. 18 Pa. Cons. Stat. § 5702, et seq. What constitutes “consent” can be contentious but, generally, consent is given if the parties to the call are clearly notified that the conversation will be recorded and they continue with the conversation, as their consent is implied. Because telephone monitoring is the mode of workplace communication most likely to be affected by the laws of the state where the communications occur, employers situated in states like California or Pennsylvania, or employers who engage in telephone calls with employees located in such states, must disclose to their employees that the call is being monitored or recorded. They should obtain their employees’ consent to such recording, or risk being found in violation of applicable state law.

Labor law also may be implicated by an employer’s surveillance of its employees. For employers who employ unionized employees, the National Labor Relations Board has held that the surveillance of any portion of the workplace is a condition of employment that typically must be the subject of collective bargaining and agreed to by the union prior to implementation. However, surveillance can become problematic for non-union employers. For instance, an employer’s surveillance or recording of employee calls during a union-organizing campaign can implicate the NLRA and lead to consequences for the employer. An employer’s surveillance or recording of employee telephone calls also can implicate common law privacy rights, which also should be considered by employers when implementing such policies or conducting such surveillance.

To comply with these proscriptions, employers seeking to intercept, record or monitor employee phone calls should establish and disseminate to their employees clearly written company policies that their telephone calls may be subject to monitoring and surveillance without any further warning. Employers should consider including certain key provisions in their establishment of companywide telephone monitoring policies, including but not limited to:

• Monitoring can occur at any time, for any reason, with or without notice, for any legitimate business-related purpose;
• The employer’s communication (telephone) systems are the property of the employer, and the employee should have no expectation of privacy in his/her use of the company telephone devices and equipment;
• The employer’s communication systems are for business use only;
• The use of the employer’s communication systems for discriminatory, harassing, bullying or other forms of misuse or unlawful misconduct is prohibited;
• The transmittal or dissemination of the employer’s intellectual property, confidential or proprietary information, or trade secrets through the use of the employer’s telephone systems is prohibited; and
• The employee’s unauthorized use of the employer’s information systems can result in discipline, up to and including the termination of employment.

Even with a monitoring policy in place, employers should expressly state that they are not obligated to monitor employee communications. Otherwise, should harmful, discriminatory or offensive conduct occur through the use of the employer’s telephone systems, employees may claim that the employer failed to protect them (or failed to appropriately investigate misconduct) through such surveillance. As with any company policy, employers should require all employees to sign a written acknowledgment that they have received, read and understood these policies, and that they agree to abide by such terms as a condition of their employment with the company. These policies should be reaffirmed by employees periodically in the ordinary course of an employer’s business.

Questions about wiretapping in the workplace? Call your employment law attorney.

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Craft Beer Wholesaler to Pay $2 M Fine to Settle Trade Practice Violations

Attorney General Christopher S. Porrino and the Division of Alcoholic Beverage Control announced a settlement with a Hunterdon county craft beer wholesaler, resulting in a record $2 million fine for alleged trade practice violations.

The Division alleged that Hunterdon Brewing Company LLC sold draft beer tap systems below fair market prices and mislabeled the charges as “miscellaneous” on invoices to conceal them. The Division alleged that the company also ignored credit regulations for at least 700 retail customers. In addition to reviewing thousands of documents, the Division compiled sworn statements from more than two dozen retail licensees.

Hunterdon Brewing agreed to the fine in a Consent Order. The fine is the largest fine ever imposed on a single wholesale license for trade practice violations. The offenses as alleged consist of violations of New Jersey statutes and regulations governing the sale and distribution of alcoholic beverages.

Attorney General Porrino stated that the alleged improper trade practices used by Hunterdon Brewing threatened to disrupt competition and the wholesale industry. He said that the Division’s actions in investigating the alleged trade practice violations “ensure that consumers will benefit from a stable alcoholic beverage industry.”

According to Jonathan Orsen, Acting Director of the Division of Alcoholic Beverage Control, the Division strives to create “a level playing field that encourages fair, open, and transparent competition.” Discriminatory trade practices stifles competition among wholesalers and consumers lose the benefits provided by open competition, he added.

The fine is to be paid in four equal installments over the next year. The Division will waive $250,000 of the final installment if compliance audits show no similar violations.

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An Anniversary in Redevelopment Law

Ten years ago today, the Supreme Court decided Gallenthin Realty Development, Inc. v. Borough of Paulsboro, 191 N.J. 344 (2007).  It was the first time that the Court focused on the meaning of the term “blighted areas” in Article VII, section 3, paragraph 1 of the New Jersey Constitution,a provision that allows such areas to […]

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Can Community Associations Regulate the Use of Drones?

Drones are the latest craze to hit the market and chances are someone in your community has a drone, or your community deals with a vendor that uses drones. Drones are small, unmanned aircraft that respond to the commands of a remote operator or follow a pre-programmed trajectory. They are technically known as “unmanned aerial vehicles” or “UAVs”. Initially developed by the military, drones are now available to the general public and are used by many businesses and individuals alike.

As drone technology develops and evolves, it is important for your Community Association’s rules to develop and evolve to protect the health, safety and welfare of residents.

A Community Association’s authority to regulate drone usage on its common property is based on the language of its governing documents. The Master Deed, Declaration and/or By-laws likely provide the Board of Directors with authority to adopt rules and regulations governing the use of Common Property. Further, the governing documents likely authorize the Board to ban, restrict or limit activity which could be considered a nuisance, among other things. Under these circumstances, the Community Association would have the authority to regulate the use of drones within the community.

Any rules and regulations promulgated by a Community Association would be in addition to federal, state and local restrictions. It is important for Community Associations to understand those restrictions and how they impact the use of drones within the community.

Current Federal Aviation Administration (“FAA”) regulations, provide that drones must, among other things: (i) weigh less than 55 lbs. (including any attachments such as a camera) if utilized for non-commercial purposes; (ii) be registered and marked; (iii) fly below 400 feet; (iv) fly within visual line-of-sight; (v) fly in clear weather conditions; and (v) never fly near other aircraft or over people.

The New Jersey legislature banned the use of drones in all its state parks, without specific permission. The use of drones is also prohibited at certain sporting events and near airports. Beyond this, your municipality may have regulations or ordinances regulating or banning the use of drones.

We can help you understand your federal, state, and local drone restrictions and determine whether your Community Association has the right to impose additional requirements or restrictions on the use of drones in your community.

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Does a Foreclosure Complaint Prevent a Community Association from Enforcing Rules and Regulations?

A New Jersey Chancery Court was called upon to rule whether the filing of a foreclosure complaint by a condominium association prevents the association from taking other actions to enforce its rules and regulations as they would apply to the defendant in the foreclosure action.

Specifically, a condominium association had started a foreclosure action against an owner, seeking to foreclose its liens. During the pendency of the foreclosure case, the Association decided to enforce its parking revocation policy, as set forth in the association’s Governing Documents. It sought to revoke parking privileges of the owner because of the substantial arrears.

The unit owner raised as a defense to the revocation of parking privileges that the matter was already the subject of the association’s foreclosure action, and that any other actions undertaken by the association to deprive the unit owner of any rights or privileges of ownership must be stayed until the foreclosure case had been concluded. The unit owner/defendant argued that if the association was successful in its foreclosure, then all rights and privileges, including parking, would be taken from the defendant at that time. The unit owner then argued that the association could not avail itself of what it called self-help means by revoking parking privileges prior to obtaining Judgment on the foreclosure case.

The association argued successfully that an association could not be deprived of its enforcement rights, and be put in a worse position by the filing of a foreclosure action than it would be in had it not commenced the foreclosure. It claimed that the two were not dependent upon each other, and that it made no sense for a court to allow a debtor to retain privileges he or she would not be able to retain if no foreclosure action had been pending.

The Court agreed with the position of the association and upheld the revocation of parking privileges, to take effect prior to any foreclosure Judgment. A judgment of Foreclosure was obtained by the association several months after the privileges had been revoked.

If your community would like to learn more about the interplay of various enforcement mechanisms, Stark & Stark’s Community Association lawyers can be of assistance.

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A Diverse Diet of New Cases for the Supreme Court

In making up for lost time, a separate post was warranted to take note of three new grants of review by the Supreme Court.  The cases address very different areas of the law. The biggest of the three cases may be Freedom From Religion Foundation v. Morris Cty. Bd. of Chosen Freeholders.  The Court granted […]

The post A Diverse Diet of New Cases for the Supreme Court appeared first on Appellate Law NJ Blog.

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Making Up for Lost Time

Several days out of the office last week, and work on a large appellate brief, have left me well behind our appellate courts, who have produced a number of decisions in that interim.  To try to catch up, here are summaries of some of those rulings by the Appellate Division: Leggette v. Government Employees Ins. […]

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Sua Sponte Reinstatement Of Dismissed Final Restraining Order Violates Due Process, Appellate Division Says

Notice and opportunity to be heard is one of the most fundamental tenants of due process in this country. Every litigant, no matter how small the case, has the right to have his or her “day in court.” As we learn in the recent Appellate Division decision of T.M.S. v. W.C.P., that applies equally to a plaintiff – the party bringing the action – and to a defendant – the party defending against the action.

Some background as to the Prevention of Domestic Violence Act (“PDVA”), N.J.S.A. 2C:25-17 to -35, may be helpful to understand the trial court’s error in this case.

Under the PDVA, a Court may enter a restraining order pursuant to a complaint to protect a victim of domestic violence. Following a hearing, the court will issue a Final Restraining Order (“FRO”) if it finds that the victim was subjected to domestic violence by someone with whom the victim has a domestic relationship. The victim must prove that an act of domestic violence occurred and that a restraining order is necessary to protect the victim from immediate danger or future acts of domestic violence.

Although restraining orders may be termed “final” that does not mean that they can never be vacated. Under the PDVA, a court may vacate an FRO upon good cause shown. N.J.S.A. 2C:25-29(d).

The case of Carfagno v. Carfagno, 288 N.J. Super. 424 (Ch. Div. 1995) establishes eleven factors a court must weigh to determine if a defendant established the requisite good cause to vacate an FRO:

(1) whether the victim consented to lift the restraining order;

(2) whether the victim fears the defendant;

(3) the nature of the relationship between the parties today;

(4) the number of times that the defendant has been convicted of contempt for violating the order;

(5) whether the defendant has a continuing involvement with drug or alcohol abuse;

(6) whether the defendant has been involved in other violent acts with other persons;

(7) whether the defendant has engaged in counseling;

(8) the age and health of the defendant;

(9) whether the victim is acting in good faith when opposing the defendant’s request;

(10) whether another jurisdiction has entered a restraining order protecting the victim from the defendant; and

(11) other factors deemed relevant by the court.

In T.M.S., a final restraining order was entered against the defendant on November 29, 2006. In 2008, the defendant moved, unsuccessfully, to vacate the FRO pursuant to N.J.S.A. 2C:25-29(d) and Carfagno. Subsequently, defendant filed a second Carfagno application to dismiss the FRO. The plaintiff did not appear for the hearing. After determining plaintiff had been properly served with notice of the hearing, the court granted the defendant’s unopposed application.

The Court made the following findings in support of its conclusion:

• Plaintiff did not consent to the FRO’s dissolution because she was not present.
• The facts proved defendant never violated the FRO because the parties had no reason to interact; specifically, because they did not have children and both were in committed relationships.
• Defendant’s prior insobriety partially contributed to the domestic violence incident, and he had been sober for nearly eight years and even chaired his sobriety group.
• Defendant attended domestic violence counseling.
• Although physically Defendant was a “big guy,” defendant had health problems that reduced his strength.
• As to plaintiff’s good faith, the court noted she did not appear in court, and there were no additional orders in other jurisdictions against defendant.

With the FRO vacated, defendant moved for relief from the weapons forfeiture, which requires a defendant to surrender his or her weapons upon the entry of the restraining order. At the initial weapons forfeiture hearing, a question arose for the first time as to whether plaintiff was properly notified of the dismissal of the FRO.

On the last day of the hearing, on December 15, 2015, the court, who had heard the initial Carfagno application, reversed its initial determination plaintiff was validly served with defendant’s dismissal application, and vacated the December 8, 2014 dismissal order, reinstating the FRO. As a result, the weapons forfeiture matter was dismissed. The Court determined that an old address on file for the plaintiff was used and it was questionable as to whether she still remained resident there.

While this case certainly calls into question the plaintiff’s notice and opportunity to be heard on the Carfagno hearing vacating the FRO, the Court focused on the Court’s violations of the defendant’s due process here. On appeal, defendant argued the PDVA does not permit a court to reinstate an FRO on its own motion. He asserted, although a trial court may revisit an interlocutory order, it could not sua sponte review a final order.

The Appellate Division agreed with the defendant and reinstated the dismissal. In doing so, the Appellate Division focused primarily on the fact that, by sua sponte reinstating the FRO in the ancillary weapons forfeiture matter, the court overlooked fundamental due process principles. If plaintiff challenged the order dismissing the FRO, she was required to file a motion for relief in the domestic violence matter, so defendant could be heard and there, address the issue of service.

The Court concluded that requiring plaintiff to reopen a dismissed TRO or FRO must be made in the underlying domestic violence matter, not an ancillary matter, and further requiring such requests to be made by formal application equally will (a) protect domestic violence victims by providing them with formal notice where there is an application to vacate the orders of protection, and, (b) assure due process for defendants.

In a footnote of the case, the Appellate Division also suggested the Conference of Family Presiding Judges consider promulgating formal operational guidance requiring plaintiffs to periodically update their address with the Family Division. We will let you know if this occurs.

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 Eliana T. Baer is a contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

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Ignite Restaurant Group Fires Up Chapter 11 Bankruptcy Case

Ignite Restaurant Group (“Ignite”) filed a voluntary petition for Chapter 11 bankruptcy protection in the Southern District of Texas, Houston Division today (Case no. 17-33550). Ignite operates 137 Joe’s Crab Shack and Brick House Tavern + Tap restaurants, including three international franchise locations in Dubai. Ignite employs 8,400 people, including 2,900 full-time (both salaried and hourly) employees. Ignite’s bankruptcy schedules list $197 million in liabilities and $153 million in assets.

In its bankruptcy filings, Ignite cites to declines in comparable restaurant sales and income from operations at both Joe’s and Brick House. The company also notes that it has closed underperforming restaurants, including a location in Newark, NJ which had opened in 2013.

Ignite determined that a sale of the Company’s assets would result in the best recovery for its stakeholders and arrived in bankruptcy with a proposed purchaser in hand. On June 5, 2017 Ignite entered into an Asset Purchase Agreement with Kelly Investment Group, a stalking horse bidder that previously purchased Champps and Fox & Hound restaurants out of bankruptcy.

If you are a landlord or trade creditor of Ignite, it is important to know your rights now. Stark & Stark’s Shopping Center Group can help. Our bankruptcy attorneys regularly represent landlords throughout the country, including recently in the Eastern District of Missouri, District of New Jersey, Southern District of New York, District of Delaware, District of Minnesota and Eastern District of Pennsylvania on a variety of issues. Most recently, our Group has represented landlords and trade creditors in the Payless, Eastern Outfitters (EMS Part 2), EMS, Golfsmith, RadioShack, General Wireless (RadioShack Part 2), Gander Mountain, A&P, Joyce Leslie, Rue21, Central Grocers, and Sports Authority Chapter 11 bankruptcy cases.

For more information feel free to contact the author of this blog.

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NJ S181-Act Concerning Snowplow/De-Icing Service Contracts in Community Associations

The New Jersey state Senate passed the bill 181, authored by Senator Christopher Bateman(Hunterdon, Mercer, Middlesex and Somerset), by a vote of 35-0 on January 23, 2017.

The bill, if passed by the Assembly and signed into law by the Governor, will render void and unenforceable any indemnification/hold harmless language in a contract with a snowplow vendor. This bill will not apply to the State or any municipal government.

Passage of New Jersey Senate bill 181 will have dire consequences for community associations. If passed, no longer can liability be imputed to a snow vendor for its negligent work. So, if a person slips and falls in a community association, and subsequently sues, the community association can no longer seek indemnification from the snow vendor – the party most likely responsible for the injury. This bill fully insulates the snow vendor from any liability UNLESS the snow vendor is given full authority to take all necessary action to “maintain the property.”

A companion Assembly bill, A3656, authored by Assemblyman Joseph Langana(Bergen and Passaic), has been referred to the Assembly Consumer Affairs Committee.

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