“A Procedural Swamp”

Lombardi v. Masso, 207 N.J. 517 (2011).  In this case, a Law Division judge granted summary judgment to certain defendants.  The judge then denied plaintiff’s motion for reconsideration.  Another defendant had defaulted.  After hearing the evidence against that defendant at a proof hearing, the judge wrote to all the parties, including the defendants to whom he had granted summary judgment, and informed them that he was going to reconsider, sua sponte, his summary judgment ruling.  He then reversed himself, explaining that the record on the summary judgment motion revealed disputed issues of material fact, and that he had made a legal error in applying the Consumer Fraud Act.

The defendants who had been stripped of their summary judgment were granted leave to appeal to the Appellate Division.  That court held that the judge below should not have relied on what he had learned at the proof hearing.  The panel reinstated the summary judgment order, but without addressing the merits of that order.

After final judgment, plaintiff filed an appeal as of right in which she challenged the original summary judgment but not the interlocutory ruling of the Appellate Division described above.  Plaintiff’s notice of appeal was filed one day late, and the filing was made in an irregular way, in that plaintiff’s counsel went to the home of an Appellate Division judge to file her appellate papers.  Plaintiff successfully moved to extend the time to appeal, under Rule 2:4-4, and defendants’ motion to dismiss the appeal was accordingly denied. 

The panel on that ultimate appeal differed from the interlocutory panel, holding that “the trial judge was within his discretion to reconsider the summary judgment order for any reason in the interests of justice.”  The Appellate Division also ruled that genuine issues of material facts existed on the original record, so as to have precluded summary judgment. 

Defendants petitioned for certification.  They argued that the interlocutory panel was right to hold that the Law Division could not reconsider summary judgment based on what that court had heard at the subsequent proof hearing, that the law of the case doctrine precluded both the Law Division and the ultimate panel of the Appellate Division from doing what they did, and that irregularities in the filing of plaintiff’s appeal required dismissal of the appeal.  By a 4-1 vote (Justice Hoens did not participate), the Supreme Court upheld the merits appeal panel and ruled that the Law Division was “well within his discretion in revisiting and vacating the interlocutory summary judgment order,” and that the law of the case doctrine did not apply.  Justice Long wrote the majority opinion.  Justice Rivera-Soto dissented.

Justice Long began by noting that even though plaintiff had not listed the Appellate Division’s interlocutory ruling as a subject of her petition for certification, that ruling was the basis for what followed and had been “fully explored” by the parties.  Because that interlocutory decision “misconceives both the nature of an interlocutory ruling and the court’s inherent power to revise such a ruling,” the Court chose to address that interlocutory order.

Justice Long emphasized the “well established” rule that “the trial court has the inherent power to be exercised in its sound discretion, to review, revise, reconsider and modify its interlocutory orders at any time prior to the entry of final judgment” (emphasis in original).  Thus, “although a party who obtains summary judgment may believe he is absolutely free of the litigation, ‘[i]t is a contradiction in terms to say that an interlocutory decree should be a finality'” (citation omitted).

“[C]ases continue to develop after orders have been entered and … judges likewise continue to think about them.”  There was nothing wrong with the fact that the Law Division judge realized his errors as a result of subsequent proceedings in the case.  Even if the judge did not limit himself to the original summary judgment record in his reconsideration process (and it was not clear to the Court whether he had), he was entitled to alter his ruling, in the interests of justice, for any reason.  What was critical was that he provided the parties the right to be heard before issuing a new ruling, and that he applied the proper legal standard and gave reasons for his new decision.

Justice Long then rejected defendants’ argument that the law of the case doctrine prevented the Law Division and the Appellate Division from revisiting the Appellate Division’s interlocutory order.  The doctrine was “entirely inapposite where, as here, in trial court proceedings, the same judge is reconsidering his own interlocutory ruling.” 

Nor did the first panel’s ruling preclude the second panel from deciding as it did.  The issues on the two appeals were different.  “The interlocutory panel decided defendants’ narrow claim that the judge could not use evidence from the later proof hearing in his analysis,” but did not address the merits and thus preserved those merits for direct appeal.  The direct appeal panel “was not only empowered to rule on the merits of plaintiff’s claim, it was required to do so.”  To the extent that the merits panel differed with the interlocutory panel as to the Law Division’s right to revisit the summary judgment order, “the panel may have overstepped.”  But the Supreme Court was under no such constraint.

Justice Long brushed off defendants’ arguments about the irregularities in the filing of plaintiff’s notice of appeal.  The one-day delay was cured by plaintiff’s motion to extend time.  The Court strongly “disapprove[d] of the self-help plaintiff’s lawyer undertook by presenting himself at the house of an appellate judge.  A lawyer who happens to know where a judge lives is not entitled to an advantage over lawyers who do not have such information.  Although filing may take place at a judge’s chambers, the judge’s house is off limits,” except in the case of after hours emergencies.  Nonetheless, the acceptance of plaintiff’s appeal was within the discretion of the Appellate Division and would not be overturned.

Finally, the Court concluded that there were indeed genuine issues of material fact in the original summary judgment record, even apart from what came out at the later proof hearing.  Accordingly, the Law Division was correct in recognizing its earlier errors and vacating the summary judgment order.     

Justice Rivera-Soto filed an angry dissent, accusing the majority of going beyond the original record despite the majority’s assertion that it had not done that.  Justice Rivera-Soto emphasized the fundamenal precept “that summary judgment motions are to be gauged exclusively on the summary judgment record adduced by the parties, and not with reference to supplementary proofs the opposing party had but nevertheless failed to produce in timely opposition.”

Justice Long was right to label this case “a procedural swamp.”  The majority waded through that swamp and reached the correct result.  It cannot be the law that a judge who recognizes an error in an interlocutory ruling is powerless to correct it.  The goal is a just decision, even if the path to that end is sometimes a winding one.