County of Warren v. Nichua Liaci ( 2024 )

NOT FOR PUBLICATION WITHOUT THE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-2935-22
COUNTY OF WARREN,
Plaintiff-Appellant,
v.
NICHUA LIACI,
Defendant-Respondent.
________________________
Argued September 10, 2024 – Decided September 27, 2024
Before Judges Sumners and Bergman.
On appeal from the Superior Court of New Jersey,
Chancery Division, Warren County, Docket No. C-
016006-23.
Lisa Barré-Quick argued the cause for appellant
(Apruzzese, McDermott, Mastro and Murphy,
attorneys; Lisa Barré-Quick, of counsel and on the
briefs; Catherine A. Morris, on the briefs).
Eric W. Feinberg argued the cause for respondent
(Caruso Smith Picini, PC, attorneys; Thomas M.
Rogers, of counsel and on the brief).
PER CURIAM
Plaintiff County of Warren appeals from a trial court order denying its
order to show cause (OTSC) to enforce settlement terms orally placed on the
record at an administrative hearing. Since we determine the essential terms of
a settlement were voluntarily agreed to by the parties are entitled to enforcement,
we reverse.
I.
The background facts and procedural history are substantially undisputed.
Defendant Nichua Liaci was a corrections officer at the Warren County
Correctional Facility (WCCF) employed by the plaintiff. In December 2021,
while off-duty, defendant was engaged in an altercation with another corrections
officer at a charity event at Phillipsburg Middle School. The other officer filed
a complaint with WCCF Internal Affairs (IA) alleging defendant engaged in
harassment, threats of violence, unprofessionalism and hostility.
Subsequently, defendant was suspended with pay and in January 2022,
she was served with a Preliminary Notice of Disciplinary Action (PNDA) which
suspended her without pay, pending the IA investigation. The investigation was
completed in April 2022, and the results were communicated to the Warren
County Administrator. The findings of the investigation led to defendant being
served an amended PNDA in May 2022, seeking defendant's removal.
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In response to the amended PNDA, defendant notified plaintiff she would
be appealing the findings and sought an administrative departmental hearing.
Additionally, defendant filed a notice of claim and an Equal Employment
Opportunity Commission charge1 against plaintiff.
A departmental disciplinary hearing was held over a three-day period in
December 2022. Prior to the start of the last hearing day, the parties engaged in
settlement negotiations. The parties reported to the hearing officer that a
settlement had been reached.
Thereafter, the parties placed the following terms of their settlement on
the record.
Defendant would retire through the Police and Fireman's Retirement
System (PFRS) as of the date of a signed agreement. A written agreement
reflecting the settlement terms reached and memorialized on the record would
be prepared by plaintiff's counsel and sent to defendant’s counsel one day after
the settlement terms were placed on the record at the hearing. In exchange for
her retirement, plaintiff would dismiss all disciplinary charges against
defendant. Defendant would sign a release waiving her "right to sue and dismiss
any lawsuits" against plaintiff and agreed to a "covenant not to sue [plaintiff]."
1
The charge was dismissed on December 16, 2022.
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Defendant would receive a payout of any unused accrued sick and vacation time
consistent with the terms of her labor union contract. The parties agreed to
mutual non-disparagement clauses. Plaintiff would provide a neutral letter of
reference, attached to the formal settlement agreement and setting forth
defendant's dates of employment and positions held. Defendant would waive
any claim to back pay. Plaintiff would pay defendant the equivalent of thirty-
five days of pay, issued to her in a check, which would not reflect pensionable
time and would be subject to applicable tax withholdings.
The parties further agreed "subject to Chapter 78 withholdings," defendant
would receive health benefits for the next three years with her portion of costs
based upon her salary and when she reaches twenty-five years of service and
retires, she will be responsible for her "retiree health contributions." Defendant
would be entitled to choose the type of health insurance benefits plan she
wished, including the option to choose a family health benefit plan. When
defendant reached age sixty-five, she would become Medicare eligible.
Defendant's counsel agreed to the settlement terms when the hearing
officer asked if an agreement was reached. Additionally, defendant responded
directly to questions concerning the settlement terms placed on the record. She
testified the terms placed on the record were the entire agreement, she
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understood the agreement, she was entering into the agreement voluntarily and
she was not under the influence of any drugs or alcohol that would impair her
ability to understand the terms of the agreement. The hearing officer then asked
defendant if the agreement had been fully explained to her to which she
responded affirmatively. In addition, defense counsel represented that the
Warren County Administrator was present and agreed to the terms of the
settlement.
In accordance with the representations agreed to on the record, the next
day plaintiff's counsel sent a document to defendant's counsel entitled
"Voluntary Retirement and Settlement Agreement" (Agreement). No dispute
exists that some of the terms contained in the Agreement differed from those
placed on the record. About six days after receipt, defendant's counsel
responded he was "redlining" the agreement. In her response, defendant
requested the balance of her hours in her "timebank" and a copy of plaintiff's
policy concerning the maximum number of hours which may be paid out.
Thereafter, a teleconference was held between counsel. At the
teleconference, defendant's counsel informed plaintiff's counsel defendant elects
to exercise her right to "repudiate" the Agreement and either move forward with
the hearing or settle under different terms.
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After some additional communications between counsel, eventually
plaintiff objected to the "repudiation" and informed defendant's counsel it would
likely file an application to enforce the terms of the settlement placed on the
record. After several exchanges of communication between the parties resulting
in no progress toward a resolution, plaintiff filed its OTSC to enforce the
settlement.
After the trial court heard oral argument, it rejected defendant's position
that plaintiff had failed to exhaust administrative remedies and found the court
had jurisdiction to hear the matter since it involved enforcement of a "contract."
The court also found it had jurisdiction to hear the OTSC since the
administrative tribunal had no "special expertise" involving contract matters.
The trial court also rejected defendant's argument the factors of Crowe v.
DeGioia, 90 N.J. 126 (1982) were applicable.
The court addressed whether the back and forth between the parties served
as a "reopening" of negotiations and if the agreement served as a "counteroffer"
from plaintiff. The court found both arguments were "relatively frivolous and
without merit." The court also found the issue "as the court sees it is not whether
it is a counteroffer or demand to amend the settlement agreement which had
been reached," but the "issue was whether or not the material terms placed on
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the record in and of themselves without being memorialized in a written
agreement are enforceable."
The trial court made a finding certain portions of the agreement were not
mentioned during the administrative hearing. Most notably, the court focused
on paragraphs nine and eleven of the proposed agreement which involved the
requirements for the release and waiver of certain claims.
Paragraph nine entitled "Employee's Release" specifically listed
numerous federal and state employment statutes subject to the release and
waiver, including the Age Discrimination in Employment Act of 1967 (ADEA).
This paragraph stated in pertinent part:
Except for claims relating to the enforcement of the
Agreement, Employee hereby releases and forever
discharges the Employer . . . from any and all manner
of action and actions . . . suits, claims, grievances,
debts, sums of money, wages, compensation, bills,
claims for attorney's fees . . . controversies, agreements
. . . claims and demands of any nature whatsoever
known or unknown . . . which Employee ever had or
now has against Employer arising out of her
employment relationship with the Employer up to the
date of execution of this Agreement which were
asserted or could have been asserted by the Employee
under any state or federal statute[.]
The court found the released actions listed in the agreement at paragraph
nine were not specifically set forth in the record at the hearing. The court stated:
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There is an explicit release from any potential claims
under the Civil Rights Act, Federal and State, there’s
Americans with Disability, Family Medical Leave, Fair
Labor Standards, Retirement Income Security Act of
1974, ERISA, Equal Pay Act, Rehabilitation Act,
Privacy Discrimination Act, Municipal Protection
Statutes, New Jersey Civil Rights, New Jersey LAD,
New Jersey Family Leave, . . . et cetera. None of which
or all of which of course were not set forth on the
record.
Finally, although neither party argued or briefed the issue, the trial court
sua sponte found paragraph eleven of the agreement entitled "Statutory Review
Revocation Period, was the controlling paragraph." Paragraph eleven stated in
pertinent part:
Pursuant to the Older Worker's Benefit Protection Act,
Employee has twenty-one (21) calendar days from the
delivery hereof to consider this Agreement. Employee
may accept this Agreement before the expiration of the
twenty-one (21) days, in which case she shall waive the
remainder of the consideration period. Employee has a
period of seven (7) calendar days after delivering the
executed Agreement to revoke acceptance of the
Agreement. [] This Agreement shall become effective
on the eighth (8th) day after the delivery of this
executed Agreement by the parties, provided that
Employee has not revoked acceptance or rescinded the
Agreement.
After reading paragraph eleven into the record, the court found the Older
Worker's Benefit Protection Act (OWBPA), 29 U.S.C.A. § 621 to 634, permits
an employee twenty-one days from its delivery to "consider" the agreement. The
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court also found the employee could "accept the agreement before the expiration
of the twenty-one-days" and thereafter would have "seven calendar days" from
the delivery of the agreement to "revoke or accept the agreement." The court
further found the agreement becomes effective on the "eighth day after delivery
of [the] executed agreement" unless "the employee has not revoked acceptance
of the agreement."
The court found "[i]n [its] opinion, [paragraph eleven] is the most
important provision of this agreement. That's because it explains [plaintiff's]
position that they're walking away from any material term of the settlement, not
contained solely in that two-page transcript of December 20[], 2022."
The trial court found the OWBPA applied to situations where there are
claims of "age discrimination in employment" and it gives protections to older
individuals regarding "employee benefit plans." The court determined the
settlement terms placed on the record applied to defendant's employee benefit
plan because it concerned "early retirement and medical benefits" and therefore
found the OWBPA was applicable including its requirements concerning the
settlement and release of claims.
The court concluded by finding:
[I]t’s clear that the specific language of [paragraph
eleven] dealing with statutory review and revocation
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period of this voluntary retirement or release
agreement, codify the requirements of the [OWBPA].
It’s clear that defendant has the right to revoke and if
the factual circumstance comes under this argument
bargained for rights under the two labor contracts, she’s
entitled to revoke it. It was clearly done under the time
period and therefore, the court finds that the –– there
was no settlement and will enter an order remanding the
disciplinary action back to the hearing officer.
This appeal followed.
II.
On appeal, plaintiff argues the trial court committed error in denying its
OTSC based on its reliance on the terms contained in paragraph eleven of the
unexecuted Agreement rather than the terms of the settlement orally set forth on
the record at the administrative hearing.
Defendant asserts the court did not err in its reasoning and argues
paragraph eleven of the Agreement permitted defendant to "repudiate" the
settlement. Also, reiterating her arguments to the trial court, defendant asserts
plaintiff should be barred from pursuing its appeal since it failed to exhaust
administrative remedies and, in the alternative, the case should be remanded for
a plenary hearing to determine whether a valid settlement was reached since
factual issues existed surrounding the validity of the settlement.
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III.
Initially, we address defendant's argument concerning the failure of
plaintiff to exhaust administrative remedies and determine defendant is barred
from raising this issue since she failed to file a cross appeal. A party may [only]
argue points the trial court either rejected or did not address, so long as those
arguments are in support of the trial court's order. See Lippman v. Ethicon, Inc.,
432 N.J. Super. 378, 381 n.1 (App. Div. 2013) ("As respondents, defendants can
raise alternative arguments in support of the trial court's judgment without filing
a cross-appeal."); Chimes v. Oritani Motor Hotel, Inc., 195 N.J. Super. 435, 443
(App. Div. 1984) ("[W]ithout having filed a cross-appeal, a respondent can
argue any point on the appeal to sustain the trial court's judgment.").
Because the trial court denied defendant's argument concerning the
exhaustion of administrative remedies now raised on appeal, this argument is
barred from being asserted on appeal since defendant did not file a cross-appeal
challenging the trial court's adverse finding. See State v. Eldakroury, 439 N.J.
Super. 304, 307 n.2 (App. Div. 2015) ("Where a defendant is seeking to expand
the substantive relief granted by the trial court, as opposed to merely arguing
an additional legal ground to sustain the trial court's [decision], the
defendant must file a cross-appeal.").
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Turning to defendant's argument claiming the trial court erred by not
holding a plenary hearing, this argument holds no merit since defendant did not
raise this point in the trial court and agreed at oral argument that no issue of
material fact existed which required a hearing in relation to plaintiff's
enforcement motion. See Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234-35
(1973) (discussing the principle that appellate courts will decline to consider
questions or issues not properly presented to the trial court when an opportunity
for such a presentation is available unless the questions so raised on appeal go
to the jurisdiction of the trial court or concern matters of great public interest ).
Addressing the parties' arguments concerning the applicability of the
holding in Willingboro Mall, Ltd. v. 240/242 Franklin Ave., LLC, 215 N.J. 242(2013), to the facts of the matter before us, we conclude they lack sufficient
merit to warrant discussion for the reasons expressed by the trial court. R. 2:11-
3(e)(1)(E). We add only that the settlement terms relevant to the matter on
appeal were not the result of a mediation as was the case in Willingboro and its
holding is therefore not applicable.
We also conclude, as did the trial court, plaintiff's proposed draft
settlement agreement which contained provisions differing from those terms
placed on the record was not a counteroffer. We find no reasons to disagree
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with the trial court's framing of the issue in its oral decision when it found the
question was whether "the material terms placed on the record without being
memorialized in a written agreement are enforceable." To answer this question,
we now address the parties' arguments concerning whether a settlement was
reached through the oral terms placed on the record and, if so, whether the
settlement should be enforced. We answer both questions in the affirmative.
We begin with a review of the well-established legal principles governing
settlements. There is a strong public policy in favor of enforcing settlement
agreements, which is "based upon 'the notion that the parties to a dispute are in
the best position to determine how to resolve a contested matter in a way which
is least disadvantageous to everyone.'" Brundage v. Est. of Carambio, 195 N.J.
575, 601 (2008) (quoting Peskin v. Peskin, 271 N.J. Super. 261, 275 (App. Div.),
certif. denied, 137 N.J. 165 (1994)).
Settlements will usually be enforced "'absent compelling circumstances.'"
Ibid. (quoting Nolan v. Lee Ho, 120 N.J. 465, 472 (1990)). "Consequently,
courts 'strain to give effect to the terms of a settlement wherever possible.'"
Jennings v. Reed, 381 N.J. Super. 217, 227 (App. Div. 2005) (quoting Dep't of
Pub. Advocate v. N.J. Bd. of Pub. Utils., 206 N.J. Super. 523 (App. Div. 1985)).
A settlement agreement is governed by principles of contract law.
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Brundage, 195 N.J. at 601 (citing Thompson v. City of Atl. City, 190 N.J. 359,
379 (2007)). "An agreement to settle a lawsuit is a contract which, like all
contracts, may be freely entered into and which a court, absent a demonstration
of 'fraud or other compelling circumstances,' should honor and enforce as it does
other contracts." Pascarella v. Bruck, 190 N.J. Super. 118, 124-25 (quoting
Honeywell v. Bubb, 130 N.J. Super. 130, 136 (App. Div. 1974)). A court may
not set aside a settlement agreement absent fraud or other misdeeds, unless the
parties clearly expressed in the agreement that rescission was an available
remedy for a breach. Kaur v. Assured Lending Corp., 405 N.J. Super. 468, 476-
78 (App. Div. 2009).
"Interpretation and construction of a contract is a matter of law for the
court subject to de novo review." Fastenberg v. Prudential Ins. Co. of Am., 309
N.J. Super. 415, 420 (App. Div. 1998). "Accordingly, we pay no special
deference to the trial court's interpretation and look at the contract with fresh
eyes." Kieffer v. Best Buy, 205 N.J. 213, 223 (2011).
"Where the parties agree upon the essential terms of a settlement so that
the mechanics can be 'fleshed out' in a writing to be thereafter executed, the
settlement will be enforced notwithstanding the fact the writing does not
materialize because a party later reneges." Lahue v. Pio Costa, 263 N.J. Super.
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575, 596 (App. Div.), certif. denied, 134 N.J. 477 (1993); see also Pascarella,
190 N.J. Super. at 124 (noting the fact a settlement was made orally "is of no
consequence").
Essential terms are those that go to the "heart of the alleged agreement."
Satellite Ent Ctr., Inc. v. Keaton, 347 N.J. Super. 268, 277, 789 (App. Div.
2002). Alternatively, if the parties do not agree to one or more essential terms,
their contract is ordinarily unenforceable. Ibid. Where parties have agreed to
the [essential] terms of a settlement, "second thoughts are entitled to absolutely
no weight as against our policy in favor of settlement." Dep't of Pub. Advocate,
206 N.J. Super at 530.
Additionally, since the trial court relied upon the waiver provisions
contained in the OWBPA to support its order now under appeal, we believe a
summary of the genesis and background concerning these provisions are
appropriate.
In 1990, Congress amended ADEA, 29 U.S.C. §§ 621-34, by passing the
OWBPA. The waiver provision contained in the OWBPA clearly indicates its
limited applicability to claims arising only under the ADEA: "An individual
may not waive any right or claim under this Act unless the waiver is knowing
and voluntary" and meets the listed criteria. 29 U.S.C. § 626(f)(1); see also
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Oubre v. Entergy Operations, Inc., 522 U.S. 422, 427 (1998) (stating "[t]he
OWBPA sets up its own regime for assessing the effect of ADEA waivers,
separate and apart from contract law").
Similarly, 29 C.F.R. §§ 1625.22 and 1625.23 specifically apply only to
the waiver of claims under the ADEA. The statutory provisions of OWBPA
apply only to ADEA claims and not to state law claims. Wastak v. Lehigh
Valley Health Network, 342 F.3d 281, 295 (3d Cir. 2003).
Based on our de novo review of the record, we conclude the
representations of the parties placed on the administrative hearing record were
the operative settlement terms, not the proposed terms of the unexecuted
Voluntary Retirement and Settlement Agreement. Therefore, we determine the
trial court's reliance on the terms in the unsigned proposed agreement which set
forth the OWBPA waiver and revocation requirements as its basis to deny
plaintiff's OTSC requesting enforcement was error.
We conclude the stipulations set forth on the record at the administrative
hearing included all the essential terms of the settlement between the parties and
was a binding and enforceable contract. The record clearly illustrates defendant
agreed to waive all claims and any future accrued claims against plaintiff in
consideration of the dismissal of the disciplinary charges against her, a
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continuation of her health insurance benefits and for other monetary
considerations including future pension benefits. Our careful review of the
record also demonstrates defendant clearly testified at the hearing she
understood all the terms of the settlement, she was entering into the settlement
terms freely and voluntarily, she was not under the influence of any substance
which would affect her ability to understand the settlement terms and the terms
placed on the record resolved all the issues between the parties.
Although we find no fault with defendant rejecting the terms in the
Agreement which were different or in addition to those placed on the record at
the hearing, defendant's relief was simply to object to those terms and require
plaintiff to provide an agreement which reflects only those terms agreed to on
the record. If plaintiff was unwilling or unable to provide a compliant
agreement, defendant had a right to make application to the appropriate tribunal
requesting enforcement. In this instance, defendant never requested plaintiff to
provide a compliant settlement agreement containing only those terms placed on
the record at the hearing.
In addition, we conclude compliance with the OWBPA is required only
for a waiver of ADEA claims. If a "release [does] not comply with the
OWBPA's stringent safeguards, it is unenforceable . . . insofar as it purports to
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waive or release [an] ADEA claim. Oubre, 522 U.S. at 428. "As a statutory
matter, the [non-conforming] release cannot bar [an] ADEA suit, irrespective of
the validity of the contract as to other claims. Ibid.We also conclude, even if the settlement terms placed on the record may
not have complied with the waiver provisions of the OWBPA, the non-
compliance did not go to the essence of the settlement. The parties agreed on
all terms which went to the "heart of the agreement," including the dismissal of
the disciplinary action against defendant in consideration for her early
retirement, and her waiver of claims against plaintiff and the financial benefits
she would receive.
A waiver and release of all claims against plaintiff was specifically agreed
to by defendant and reflects the clear intent of the parties. We conclude the
parties' failure to specifically address the waiver of ADEA claims on the record
was not a compelling circumstance which would justify the denial of plaintiff's
OTSC. At the heart of the settlement was a general waiver of all other claims
by defendant which implicitly included a multitude of other pending and
potential state and federal employment claims.
Based on the Court's reasoning in Oubre, we determine it is neither unfair
nor inequitable under the factual circumstances before us to require the
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defendant to honor the terms she agreed to on the record including her waiver
of all claims against plaintiff. Oubre concluded the OWBPA sets forth the
requirements for the waiver and release of ADEA claims only and does not
affect the waiver of other federal or state law claims not subject to its purview.
The terms concerning the waiver of ADEA claims set forth in paragraph eleven
of the unexecuted Agreement was not directly addressed at the hearing and
therefore this waiver was clearly not an essential term of the settlement between
the parties.
We do not make any determination as to the viability of any current or
future ADEA claims which could be initiated by defendant. We determine only
the trial court's reliance on the OWBPA provisions in the proposed unexecuted
written agreement to support its denial of plaintiff's OTSC was erroneous and
was an insufficient basis to invalidate the clear intent of the parties to resolve
their matter under the settlement terms set forth on the record at the hearing.
We remand to the trial court to enter an order requiring the parties to
exchange and execute a written agreement which contains the settlement terms
agreed to by the parties on the record on December 20, 2022. We otherwise
affirm. We do not retain jurisdiction.
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