LON C. TAYLOR v. PUBLIC DEFENDER JOSEPH KRAKORA (L-1441-19, MERCER COUNTY AND STATEWIDE) ( 2022 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0294-20
LON C. TAYLOR,
Plaintiff-Appellant,
v.
PUBLIC DEFENDER JOSEPH
KRAKORA, RETIRED ACTING
DEPUTY PUBLIC DEFENDER
MATTHEW ASTORE, RETIRED
FIRST ASSISTANT PUBLIC
DEFENDER SUSAN GREEN,
and NEW JERSEY OFFICE OF
THE PUBLIC DEFENDER,
Defendants-Respondents.
______________________________
Argued June 6, 2022 – Decided July 15, 2022
Before Judges Rothstadt, Mayer, and Natali.
On appeal from the Superior Court of New Jersey, Law
Division, Mercer County, Docket No. L-1441-19.
Kevin T. Flood argued the cause for appellant.
Niccole L. Sandora, Deputy Attorney General, argued
the cause for respondents (Matthew J. Platkin, Acting
Attorney General, attorney; Jane C. Schuster, Assistant
Attorney General, of counsel; Niccole L. Sandora, on
the brief).
PER CURIAM
Plaintiff Lon C. Taylor appeals from the Law Division's August 18, 2020
Rule 4:6-2(e) dismissal of the complaint he filed that asserted claims relating to
his alleged forced retirement against his former employer, defendant New Jersey
Office of the Public Defender (OPD), and his supervisors, Public Defender
Joseph Krakora, Retired Acting Deputy Public Defender Matthew Astore, and
Retired First Assistant Public Defender Susan Green. His complaint included
claims under the New Jersey Law Against Discrimination (NJLAD), N.J.S.A.
10:5-1 to -50, and the New Jersey Civil Rights Act, (NJCRA) N.J.S.A. 10:6-1
to -2, as well as for infliction of emotional distress.
The motion judge dismissed the complaint after determining plaintiff
voluntarily waived all his claims against defendants pursuant to a settlement
agreement and its subsequent amendment that the parties executed prior to
defendant's retirement from the OPD. The judge also alternatively dismissed
without prejudice four counts of the complaint for failure to state a claim upon
which relief could be granted.
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On appeal, plaintiff argues the settlement agreement, as amended, was
unenforceable because it was unconscionable, a contract of adhesion, against
public policy, and violated the NJLAD. Moreover, plaintiff claims, as he alleged
in his complaint, that he did not voluntarily enter into the settlement agreement
but signed it under the mental anguish and duress caused by defendants.
Additionally, plaintiff argues the judge improperly dismissed his complaint
because his pleadings were sufficient to at least suggest claims, after giving him
the benefit of all reasonable inferences.
We have considered plaintiff's contentions in light of the record and
applicable principles of law. We reverse the dismissal of plaintiff's com plaint
that was based upon plaintiff signing the settlement agreement and its
amendment as we conclude the motion judge mistakenly applied the wrong
standard to defendants' Rule 4:6-2 motion by not accepting as true the
allegations of plaintiff's complaint as required when considering a motion filed
under the rule. In accordance with Rule 2:2-3, we do not address plaintiff's
remaining contentions about the without prejudice dismissal of four counts of
his complaint as that portion of the challenged order remains interlocutory.
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I.
"We review a grant of a motion to dismiss a complaint for failure to state
a cause of action de novo, applying the same standard under Rule 4:6-2(e) that
governed the motion [judge]." Wreden v. Twp. of Lafayette, 436 N.J. Super.
117, 124 (App. Div. 2014). That standard is whether the pleadings even
"suggest[]" a basis for the requested relief. Printing Mart-Morristown v. Sharp
Elecs. Corp., 116 N.J. 739, 746 (1989). As a reviewing court, we assess only
the "legal sufficiency" of the claim based on "the facts alleged on the face of the
complaint." Green v. Morgan Props., 215 N.J. 431, 451 (2013) (quoting Printing
Mart-Morristown, 116 N.J. at 746).
Consequently, "[a]t this preliminary stage of the litigation [we are] not
concerned with the ability of plaintiffs to prove the allegation contained in the
complaint." Printing Mart-Morristown, 116 N.J. at 746. "[T]he ability of the
plaintiff to prove its allegations is not at issue," rather the facts as pled are
considered "true" and accorded "all legitimate inferences." Banco Popular N.
Am. v. Gandi, 184 N.J. 161, 166, 183 (2005). We "search[] the complaint in
depth and with liberality to ascertain whether the fundament of a cause of action
may be gleaned even from an obscure statement of claim." Printing Mart-
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Morristown, 116 N.J. at 746 (quoting Di Cristofaro v. Laurel Grove Mem'l Park,
43 N.J. Super. 244, 252 (App. Div. 1957)).
Only in the "rare instance" where a cause of action is not even "suggested"
by the pleadings, is a Rule 4:6-2(e) motion to dismiss granted. Flinn v. Amboy
Nat'l Bank, 436 N.J. Super. 274, 286 (App. Div. 2014) (first quoting Smith v.
SBC Commc'ns, Inc., 178 N.J. 265, 282 (2004); and then quoting Printing Mart-
Morristown, 116 N.J. at 746). Likewise, where the pleadings give rise to a
question of whether a party voluntarily and intentionally waived a known right
our review is similarly de novo. Cole v. Jersey City Med. Ctr., 215 N.J. 265,
275-76 (2013) (quoting Knorr v. Smeal, 178 N.J. 169, 177 (2003)).
"However, we have also cautioned that legal sufficiency requires
allegation of all the facts that the cause of action requires." Cornett v. Johnson
& Johnson, 414 N.J. Super. 365, 385 (App. Div. 2010), aff'd as modified, 211
N.J. 362 (2012). In the absence of such allegations, the claim must be dismissed.
Ibid. (citing Sickles v. Cabot Corp., 379 N.J. Super. 100, 106 (App. Div. 2005)).
II.
With these guiding principles in mind, we turn to the allegations of
plaintiff's complaint. They are summarized as follows.
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Plaintiff was employed as an Assistant Deputy Public Defender (APD) by
the OPD from January 1990 to September 1, 2017. During the relevant period,
Krakora was the New Jersey Public Defender, Astore was Acting Deputy Public
Defender of the OPD Appellate Section and supervised plaintiff, and Green was
First Assistant Deputy Public Defender of the Appellate Section and also
supervised plaintiff.
Prior to 2012, plaintiff had an unblemished record serving as an APD in
criminal cases. According to plaintiff, beginning in or about 2012, the OPD
through Krakora and others, began to treat him differently than he had been
treated in the past, without any legitimate justification. Specifically, during
2012, Krakora told plaintiff that "he expected older attorneys 'to shoulder t heir
burden,'" bragged about hiring many young attorneys to replace them , and
mocked older attorneys for their views about zealous advocacy.
Thereafter, in 2013, following a meeting where Astore berated plaintiff
regarding two cases he recently had been working on, Deborah Collins, a
manager in the Appellate Section, shared with plaintiff that Astore bragged to
her and others about berating plaintiff. According to plaintiff, Collins stated
that she and others voiced their disapproval of Astore's actions to him.
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Nevertheless, in 2014, Astore expressed his unjustified criticism of
plaintiff about his handling of a case and expressed to others his contempt for
plaintiff and criticism of his work. These attacks on plaintiff occurred while at
around the same time, in late-2014 to early-2015, plaintiff underwent hip
replacement surgery, retinal surgery, and a difficult divorce that left him
chronically depressed and on medication.
However, despite the harsh criticism to which he was subjected, plaintiff
had, up until mid-2015, an exemplary record and received hundreds of glowing
reviews about briefs that he wrote. And, in fact, in March 2015, plaintiff
received a positive evaluation commending him for the high-quality of his work.
Nevertheless, in July 2015, in response to Astore chastising one of
plaintiff's colleagues for his vigorous representation of a client, plaintiff posted
the following comment on Facebook regarding his divorce and OPD
management:
What drives me nuts is when people in the workplace
and the home don't talk about the big elephants in the
room, prompted by fear, loathing and a phony, shrill
inner-voice that claims we are taking the "high road."
But we must at least, even if in whispers, talk among
each other. I'm experiencing both right now, big time.
In response, three days later, Astore confronted plaintiff in a hostile manner and
asked him, "Why do you like to hang around losers?"
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In August 2015, Green issued an "unduly and extremely critical" review
of a letter-brief plaintiff wrote, which was not consistent with past practices.
Plaintiff asked for an explanation about why the review process changed and the
next month, he met with Green and Astore regarding the matter, during which
he was "scold[ed]" again for his Facebook post and for "unfriending" OPD
colleagues, which others also did.
According to plaintiff, this was "a stunning and chilling suppression of
free speech in the wake of the hostility exacted upon [p]laintiff by [d]efendants."
Plaintiff separately met with Krakora in the presence of Christopher Rojas
regarding his letter-brief, which also resulted in a "scolding" for his Facebook
post.
Green continued issuing critical reviews of plaintiff's work. In response,
in October 2015, plaintiff emailed his Communication Workers of America
(CWA) union representative regarding the retaliation he received from
defendants and what seemed like their goal to terminate him because of his age,
disabilities, and his Facebook post. The representative called him and advised
him that his emails may be seen by others, to stop communicating by email, and
to delete the emails "as others had done."
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The next month, Green gave plaintiff an overall "satisfactory" evaluation,
however, she focused her negative comments on the quality of plaintiff's briefs
and expressed her concern that "[p]laintiff was not able to write a basic brief."
Two months later, per Astore's request, Green met with plaintiff to advise him
that he was not meeting expectations and that he was on the "hot seat," and to
ask if he was "mentally up" for the job, without discussing any options that could
help. Plaintiff considered this meeting as confirmation that their goal was to
wrongfully terminate him.
In February 2016, plaintiff heard from a colleague that Green told him
that if plaintiff retired by the end of the year, Astore would likely harass him
less. Astore confirmed Green's advice and promised plaintiff a "soft landing."
Plaintiff felt he had to agree with this proposal in light of the pattern of
retaliation he was confronted with daily. However, he asked Astore to permit
him to retire in September 2017 so he could receive "social security" at the age
of 62. Astore rejected the request, saying, "that is not going to happen."
Astore's response, along with defendants bypassing protocol and remedial
options, and their constantly demeaning plaintiff, caused him to become
mentally exhausted and made him fear he would be terminated if he did not
retire when defendants requested. As a result, plaintiff informally agreed to
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retire at the end of 2016, and took a month-long mental health leave of absence
from work during March 2016, at the direction of his doctor.
After plaintiff returned to work, in July 2016, plaintiff asked to work from
home for one day due to illness, which Green denied, stating Astore would not
approve him "working from home, whatsoever." That response was inconsistent
with past procedures as ordinarily Green approved these requests for other
attorneys. In fact, at a meeting several months later, Astore bragged to plaintiff
that he approved three attorneys' requests to work from home due to personal
difficulties. Plaintiff considered Green and Astore's conduct as hostile and
retaliatory toward him.
During the latter part of 2016, plaintiff was subjected to increasing
criticism of his work. For example, in October 2016, Astore "scolded" plaintiff
during a meeting for not doing his job, even though plaintiff had done everything
required of him, which was more than what other retiring attorneys were
expected to do.
In December 2016, in response to receiving an "extremely unfair,
negative[,] and nasty" evaluation from Green, plaintiff contacted his union and
filed two grievances against OPD management, claiming they harassed and
discriminated him because of his age and did not afford him his contractual
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rights, and requesting a corrected evaluation. Plaintiff also filed a complaint
with the Equal Employment Opportunity Commission (EEOC).
In response to plaintiff's grievances, on December 29, 2016, defendants
met with plaintiff and offered to settle the matter. They presented plaintiff, who
appeared without counsel but with his union representative, with a settlement
agreement whereby they permitted plaintiff to withdraw his retirement
application, conditioned upon plaintiff resubmitting it with a September 1, 2017
retirement date, his accepting a demotion in title and pay, and requiring that he
immediately resign/retire if they determined plaintiff was not meeting the
standards of that position.
Moreover, under the proposed agreement, plaintiff was required to release
OPD and its employees from all claims, suits, or actions. The waiver provision
of the proposed settlement agreement stated the following:
[Plaintiff] waives all claims, suits or actions,
whether known, unknown, vested or contingent, civil,
criminal or administrative, in law or equity against the
State of New Jersey, the [OPD], their employees,
agents, or assigns, including but not limited to those
which have been or could have been made or
prosecuted on account of any conduct of any party
occurring at any time with respect to the events,
information or disputes giving rise to this action up to
the date of this agreement, including but not limited to
all claims under Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Americans with
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Disabilities Act, the Family Leave Act, the Family and
Medical Leave Act, the [NJLAD], NJ Family Leave
Act, the Equal Pay Act, the Conscientious Employee
Protection Act, the Age Discrimination in Employment
Act, Title 11A – the Civil Service Act, the
Handicapped, Blind or Deaf Persons Civil Service Act,
the Developmental Disabled Rights Act, the
Alcoholism, Treatment and Rehabilitation Act, the
Older Workers Benefits Protection Act, the
Occupational Safety and Health Act, the Public
Employee Occupational Safety and Health Act, the
Right to Know Act, the New Jersey Smoking Act, New
Jersey wages and hours law, public works statutes,
unemployment compensation laws, disability benefits
laws, the US Constitution, the New Jersey Constitution,
any workers compensation or common law claims and
any contract express or implied.
The settlement agreement also included a provision that the parties "freely
and voluntarily" agreed to its terms. Fearing he would be immediately
terminated if he did not sign the settlement agreement, and while under the stress
and mental anguish caused by defendants' repeated harassment, discrimination,
and retaliation, plaintiff signed the "inequitable, unilateral, and unconscionable
'settlement'" on the day it was presented to him.
He also signed at the same time a certification attached to the agreement
which stated that he "reviewed this Settlement Agreement and fully underst[ood]
its meaning and terms," that his CWA "representative questioned [his]
acceptance of the agreement," that he was "satisfied with [his] representation,"
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that he "enter[ed] into this Agreement voluntarily," and that he understood it
would "terminate all claims and further appeal against the State of New Jersey,
[OPD]."
In February 2017, the EEOC issued a notice of investigation into
plaintiff's complaint, but defendants forced plaintiff to withdraw his complaint.
Plaintiff requested a transfer to a different unit or to be supervised by someone
other than Green or Astore, but defendants denied that request and instead
placed him under Astore's direct supervision.
On July 20, 2017, after monitoring him, Astore and Krakora "combatively
and aggressively confronted" plaintiff about his timesheets which they claimed
he falsified because he arrived late and left early. They stated he would be
docked two weeks' pay and "threatened" that if he disagreed with them then the
consequences would be "severe." Plaintiff found their actions inconsistent with
past practices as, customarily, retiring attorneys were not held to strict schedules
and, in any event, attorneys would first be warned and then face progressive
discipline.
On July 24, 2017, Krakora drafted a proposed amendment to the
settlement, wherein plaintiff would agree to be suspended without pay for nine
days in August for "falsification of timesheets," going forward he would sign in
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and out with a secretary, that Astore would continue as his direct supervisor,
and that the parties "voluntarily agree[d]" to its terms. At that time, defendants'
threats of "severe" consequences caused plaintiff to fear he would be terminated
and face criminal charges if he did not acquiesce, so, on July 25, 2017, in the
presence of his union representative, but again without counsel, he signed the
amendment along with another certification confirming his understanding of the
amendment on the day it was presented to him.
On September 1, 2017, plaintiff was "forced to retire," which he viewed
as essentially a "de facto firing," and one final act of retaliation for his Facebook
post, age, disabilities, and filing grievances.
Almost two years later, plaintiff filed his complaint, which he amended
on August 25, 2019. In it, plaintiff pled eleven counts, asserting claims under
the NJCRA, the LAD, and common law torts, including "emotional distress" and
civil conspiracy, arising out of defendants conduct from 2015 through
September 1, 2017. In response, without filing an answer, defendants filed a
Rule 4:6-2(e) motion to dismiss plaintiff's amended complaint, arguing that
plaintiff's claims were barred by the settlement agreement as amended, and that
plaintiff failed to plead sufficient facts to suggest claims for which relief could
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be granted. Plaintiff opposed the motion with his attorney's supporting
certification.
After considering the parties' oral arguments,1 the motion judge issued a
comprehensive oral decision on August 6, 2020 that she continued on August
13, 2020. In her decision, she first determined whether each count was properly
pled and then whether the agreement barred plaintiff's claims.
First, the judge determined all counts were properly pled, except count
four, plaintiff's LAD age discrimination claim, because plaintiff did "not [plead]
enough facts in the complaint to show lack of similar employment actions to
others in the protective class";2 count five, his LAD failure to accommodate
claim, because "plaintiff ha[d] not shown that he made a request for
accommodation due to his perceived disabilities with physical and mental
1
Although the arguments are referred to in the order under appeal, neither party
has supplied a transcript of the proceedings at which they were presented.
2
The judge's comment as transcribed reflects what appears to be a misstatement
of the law that the judge cited earlier in her oral decision. Specifically the judge
first noted that the fourth element of a discrimination claim is a showing that
"others not within [plaintiff's] protective class were not subjected to similar
employment actions," but then she concluded that "[t]here's not enough facts in
the complaint to show lack of similar employment actions to others in the
protective class." (Emphasis added). As discussed infra, we remand this
problem for reconsideration by the motion judge.
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ailments;" count eight, his aiding and abetting LAD claim, because plaintiff did
not specify who the principal violator was that the others aided and abetted; and
count ten, his emotional distress claim, because plaintiff did not specify this was
a claim for intentional infliction of emotional distress. 3
Ultimately, the judge dismissed all eleven counts because they were
barred by the settlement agreement and its amendment, which the judge
determined plaintiff knowingly and voluntarily entered based on the pleadings
alone. The judge found the agreement was clear, reasoning that "[t]he agreement
[waived] any and all rights to sue the defendants for actions that gave rise [to]
the plaintiff's grievances. The agreement also state[d] that it fully dispose[d] of
all issues and controvers[ies] between the parties."
The judge then considered the Swarts4 factors and determined plaintiff
voluntarily signed the agreements, reasoning:
The plaintiff being an experienced attorney with over
[twenty-five] years should have provided him with a
basic understanding of what the agreement was and
what it meant to sign it. The benefits conferred on the
plaintiff allowed him to continue working in his job
until he reached retirement and to receive his full
pension. To add more, the plaintiff also relied upon a
3
Defendants' brief on appeal inaccurately states count 3 was also dismissed, it
was not.
4
Swarts v. Sherwin-Williams Co., 244 N.J. Super. 170 (App. Div. 1990).
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union rep from the [CWA] to help him in his decision
to implement and sign the agreement. This also negates
any argument that the plaintiff lacked any bargaining
power in this process.
While the plaintiff may argue economic compulsion,
the totality of the circumstances weigh against his
argument when considering that the plaintiff is
experienced as attorney, his benefit that he received
from the agreement, the support the plaintiff had in
bargaining and undersigning the agreement, the interest
encouraging settlements when they appear to be fair
and beneficial to all parties.
The judge acknowledged this determination left redress only for "actions
after the agreement was reached" and that "fall[] outside the wording of the
agreement."
On August 18, 2020, the judge entered an order dismissing plaintiff's
complaint without prejudice. 5 This appeal followed.
III.
We begin our review by addressing plaintiff's argument that the motion
judge's conclusion that plaintiff waived any claims he had against defendants
under the settlement agreement as amended was contrary to the law.
5
Although the judge designated the dismissal as without prejudice, her finding
as to the settlement agreement as amended rendered the matter final as to claims
arising prior to the signing of the settlement agreement's amendment. For that
reason, as to that issue, we accepted plaintiff's appeal as not being from an
interlocutory order.
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Specifically, he contends the agreements were unconscionable and coercive,
contracts of adhesion, and invalid under a Swarts analysis because of defendants'
one-sided bargaining power, coercive tactics, and his mental anguish that
defendants caused through incessant discriminatory and retaliatory acts. He also
claims the agreement as amended is against public policy and banned by statute.
According to plaintiff he sufficiently pled facts to support his assertion that he
involuntarily signed the agreement under mental anguish and duress, questions
of voluntariness should have been left for a jury to decide or at the very least a
hearing should be held on that issue.
Plaintiff also contends that the duress he was under to sign the amendment
was underscored by defendants' implicit threat of criminal prosecution.
Additionally, plaintiff contends his experience practicing criminal law did not
support finding he voluntarily entered into the agreements, and no ot her Swarts
factor favors that finding.
Also, plaintiff concedes the recently enacted statute barring waiver of
certain discrimination claims is not retroactive, but argues its existence
demonstrates that such agreements are against public policy. Ultimately,
plaintiff emphasizes his "[a]mended [c]omplaint clearly sets forth that the
[agreement as amended] [was] not entered into voluntarily," and, according to
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plaintiff, the judge erred by not according him with all reasonable inferences at
the pleading stage.
We agree that the issue about whether plaintiff voluntarily entered into
the settlement agreement and its amendment should not have been determined
in response to a Rule 4:6-2(e) motion and decided upon the pleadings in light of
the complaint's allegations that he was forced to sign the settlement agreement
and its amendment under duress and while allegedly suffering from mental
health and other issues.
Prior to March 18, 2019, employees could waive "substantive or
procedural right[s] or remed[ies] relating to a claim of discrimination,
retaliation, or harassment." See Antonucci v. Curvature Newco, Inc., 470 N.J.
Super. 553, 563 (App. Div. 2022) (quoting N.J.S.A. 10:5-12.7) (recognizing
N.J.S.A. 10:5-12.7 provides such waivers to be against public policy and
unenforceable in agreements entered into, renewed, modified, or amended on or
after March 18, 2019); 6 see also, e.g., Swarts, 244 N.J. Super. at 176 (addressing
a waiver before the enactment of the amendment to the LAD). However, for the
6
We reject as without merit plaintiff's argument on appeal that N.J.S.A. 10:5-
12.7 renders pre-amendment waivers unenforceable. The statute does not
retroactively apply to plaintiff's agreement, which was entered into in 2016 and
amended in 2017.
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waiver to be enforceable, the employee had to execute the waiver knowingly
and voluntarily. Swarts, 244 N.J. Super at 176.
In Swarts, we adopted a totality of the circumstances test to determine
whether a waiver was enforceable. Id. at 177. There, we delineated the
following six nonexclusive factors that a court should consider when making
that determination:
1) the plaintiff's education and business experience, 2)
the amount of the time the plaintiff had possession of
or access to the agreement before signing it, 3) the role
of plaintiff in deciding the terms of the agreement, 4)
the clarity of the agreement, 5) whether the plaintiff
was represented by or consulted with an attorney, and
6) whether the consideration given in exchange for the
waiver exceeds employee benefits to which the
employee was already entitled by contract or law.
[Ibid. (quoting Coventry v. U.S. Steel Corp., 856 F.2d
514, 523 (3d Cir. 1988)).]
Additional considerations included: "(1) whether an employer encourages
or discourages an employee to consult an attorney and (2) whether the employee
had a fair opportunity to do so." Ibid.Unlike here, in Swarts, we applied the delineated considerations in our
review of a motion judge's grant of summary judgment dismissing plaintiff's
complaint. Id. at 172. We observed the plaintiff sought to create a genuine issue
of material fact by asserting in an affidavit only that "he did not intend to waive
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his age discrimination rights when he signed the release." Id. at 176. However,
we determined that the affidavit was disingenuous based on the totality of the
circumstances, in other words that the plaintiff indeed voluntarily waived his
claims.
Although possible, as in Swarts, a motion for summary judgment is
ordinarily "very difficult to sustain" where "subjective elements of willfulness[
or] intent" are "material to the claim or defense." Judson v. Peoples Bank & Tr.
Co. of Westfield, 17 N.J. 67, 76 (1954). Where the issue is not whether the
waiver is valid as a matter of law, but whether it was entered into voluntarily,
logically, on a motion to dismiss under Rule 4:6-2(e) that requires a court to
accept the facts as pled as true and uncontradicted, rather than a court inquiring
on summary judgment whether an issue of fact is genuine under Rule 4:46-2(c),
it is even more difficult, if not impossible, to determine the issue. See Banco
Popular, 184 N.J. at 166. Consequently, the Swarts analysis is not appropriate
in consideration of a Rule 4:6-2(e) motion to dismiss where, as here, a plaintiff
pled facts to suggest he did not voluntarily execute a waiver.
In fact, as far as we can determine, no state or federal court has conducted
a Swarts analysis in the context of a Rule 4:6-2(e) motion to dismiss. See, e.g.,
Banco Popular, 184 N.J. at 166 (motion for summary judgment); Great W.
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Mortg. Corp. v. Peacock, 110 F.3d 222, 226 (3d Cir. 1997) (motion to compel
arbitration); Geraghty v. Ins. Servs. Office, 369 F. App'x 402, 407 (3d Cir. 2010)
(at least partially converted the motion to dismiss into a motion for summary
judgment). The reason, we conclude, is that the standard on a motion to dismiss
does not lend itself to determining voluntariness based on Swarts factors and a
totality of the circumstances test. On a Rule 4:6-2(e) motion, the only question
should be whether the facts as pled suggest the waiver was signed involuntarily.
Another interrelated defense to the enforcement of a contract is that a
party was forced to enter it under economic duress. "Economic duress occurs
when (1) the party alleging it is 'the victim of a wrongful or unlawful act or
threat', [(2)] which 'deprives the victim of his [or her] unfettered will.'"
Muhammad v. Cnty. Bank of Rehoboth Beach, 379 N.J. Super. 222, 240 (App.
Div. 2005) (quoting Quigley v. KPMG Peat Marwick, LLP, 330 N.J. Super. 252,
263 (App. Div. 2000)), rev'd on other grounds, 189 N.J. 1 (2006). "[T]he
'decisive factor' is the wrongfulness of the pressure exerted[,]" and "[t]he term
'wrongful' . . . encompasses more than criminal or tortuous acts, for conduct may
be legal but still oppressive." Ibid. (quoting Cont'l Bank of Pa. v. Barclay Riding
Acad., 93 N.J. 153, 176 (1983)). "Further, wrongful acts can include acts that
are wrong in a moral or equitable sense." Id. at 240-41 (affirming grant of order
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to compel arbitration where the plaintiff was not the victim of a wrongful act
because, although she was experiencing financial distress, "[n]o employee of the
defendants solicited plaintiff or exerted pressure on her to" enter into any payday
loan agreement).
Here, it was simply premature to question plaintiff's voluntariness and
dismiss his complaint in light of the facts alleged by plaintiff that we must accept
as true—including that plaintiff was forced to sign the agreements under
duress—rendering the agreements unenforceable. This is so especially since
plaintiff did not allege the duress in a conclusory fashion, rather he detailed the
repeated acts of "sadistic" retaliation by defendants.
As the motion judge recognized, plaintiff's alleged forced retirement
under the settlement agreement created the possibility of economic compulsion.
Although "economic pressure alone is not enough to constitute duress rendering
an otherwise valid release void," Keelan v. Bell Commc'ns Rsch., 289 N.J.
Super. 531, 548 (App. Div. 1996), the nature and extent of the threat along with
its deleterious effect on plaintiff suggests the agreements could have been
executed involuntarily, especially in light of the totality of plaintiff's allegations.
See ibid. (reversing grant of summary judgment where employee was given a
short amount of time to review the agreement and was potentially under duress).
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Under these circumstances, defendants' motion to dismiss should have been
denied.
Contrary to defendants' contentions on appeal, even if we apply the Swarts
factors to plaintiff's allegations, they did not warrant dismissal on the pleadings.
A Swarts analysis of the allegations that, again, we must accept as true, favors
a determination that plaintiff involuntarily entered into the settlement agreement
and its amendment.
As to factor one (education and experience), although plaintiff was an
attorney, his experience as an APD practicing criminal law does not necessarily
provide him with the extensive knowledge, let alone competence, of an
employment law attorney.
Factor two (time to review agreement) also favors involuntariness as
plaintiff was apparently forced to sign the agreements the same day they were
presented to him. See Keelan, 289 N.J. Super. at 547 (seven days to review
created genuine issue of material fact).
Factor three (input in deciding terms) also favors involuntariness; based
on plaintiff's allegation that he was being forced to retire, regardless of whether
his retirement date was the end of 2016 or later in 2017—retirement was not his
choice.
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Factor four (clarity of agreement) is unsupported by the agreement's
lengthy 242-word sentence that included language that could be read to have
limited the agreement to only claims arising from the grievances plaintiff filed
and no other claims. See id. at 543 (130-word waiver sentence was still clear).
As for factor five (attorney representation), it also favors involuntariness,
because plaintiff was not represented by an attorney nor was he encouraged to
seek an attorney, and, based on the limited time permitted to sign the
agreements, he was not afforded a fair opportunity to do so.
Finally, factor six (consideration given) also favors involuntariness.
Although the parties did not provide the terms of the retirement application for
the appellate record, we infer the ordinary practice was that he could withdraw
his voluntary retirement application up until his retirement date and continue in
his same position at his same salary, assuming his position was still available.
Under that circumstance, plaintiff did not receive any consideration in exchange
for his waiver and agreement to take a demotion in title and a reduction in pay.
We therefore reverse the dismissal of plaintiff's complaint to the extent it
was based upon an assumption that plaintiff voluntarily signed the settlement
agreement and its amendment, which was contrary to the allegations of the
complaint.
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IV.
Having determined that plaintiff's complaint should not have been
dismissed on the pleadings based on the settlement agreement and its
amendment, we turn to plaintiff's arguments about the dismissal of the four
counts that the motion judge explained was for reasons other than the terms of
the settlement agreement and its amendment. We note again that the dismissal
of those counts was without prejudice to the extent the waiver did not apply, and
therefore was an interlocutory order that should await final deposition. We
therefore are not determining in this appeal whether the dismissal of the four
counts without prejudice should be upheld. Plaintiff's appeal as to those counts
is dismissed without prejudice as interlocutory.
However, as earlier noted, there is an inconsistency in the motion judge's
statement of reason relating to the dismissal of the fourth count. To ensure that
plaintiff understands the parameters of any attempt to amend his complaint, we
direct the motion judge to clarify the inconsistency in her statement of reasons.
In doing so, the judge should consider recent case law 7 and state what further
7
For example, in Nini v. Mercer Cnty. Cmty. Coll., 406 N.J. Super. 547, 554
(App. Div. 2009), we recognized "[i]n order to successfully assert a prima facie
claim of age discrimination under the LAD, plaintiff must show that: (1) she
was a member of a protected group; (2) her job performance met the 'employer's
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allegations are required to remedy the deficiency she intended to point out to the
parties, or if upon reflection she is convinced that the fourth count should not
have been dismissed, the judge should enter an order reinstating that count
without further amendment.
Having said that, we do not suggest one way or the other what the outcome
of the judge's reconsideration of the problem should be, other than that it should
be corrected. The judge should complete her review of this issue and notify the
parties of her determination within fourteen days. Thereafter, plaintiff should
be allowed fourteen days to file an amended complaint if he so chooses.
The matter is reversed for entry of an order reinstating plaintiff's
complaint, except for counts four, five, eight and ten, which remain dismissed
without prejudice to plaintiff filing an amended complaint within fourteen days
of receipt of the motion judge's clarification as to the dismissal of count four.
Dismissed in part; reversed in part and remanded for further proceedings
consistent with our opinion.
legitimate expectations'; (3) she was terminated; and (4) the employer replaced,
or sought to replace, her. Zive v. Stanley Roberts, Inc., 182 N.J. 436, 450
(2005)."
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