UNDERWOOD PROPERTIES, LLC v. CITY OF HACKENSACK (L-7980-19, BERGEN COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0044-20
UNDERWOOD PROPERTIES,
LLC,
Plaintiff-Appellant/
Cross-Respondent,
v. APPROVED FOR PUBLICATION
January 24, 2022
CITY OF HACKENSACK and
DEBORAH KARLSSON, in APPELLATE DIVISION
her professional capacity as
Records Custodian for the City
of Hackensack,
Defendants-Respondents/
Cross-Appellants.
Argued January 6, 2022 – Decided January 24, 2022
Before Judges Alvarez, Mawla, and Mitterhoff.
On appeal from the Superior Court of New Jersey, Law
Division, Bergen County, Docket No. L-7980-19.
Leonard E. Seaman argued the cause for
appellant/cross-respondent (Law Offices of Richard
Malagiere, PC, attorneys; Richard Malagiere, of
counsel; Leonard E. Seaman, of counsel and on the
briefs).
Steven W. Kleinman argued the cause for
respondents/cross-appellants (Cleary, Giacobbe,
Alfieri, Jacobs, LLC, attorneys; Steven W. Kleinman,
of counsel and on the briefs).
The opinion of the court was delivered by
MAWLA, J.A.D.
Plaintiff Underwood Properties, LLC appeals from a July 24, 2020 order,
denying its application under the Open Public Records Act (OPRA), N.J.S.A.
47:1A-1 to -13, to compel defendants City of Hackensack and its records
custodian Deborah Karlsson to produce privileged documents, and awarding
plaintiff counsel fees. Defendants cross-appeal and also challenge the counsel
fee award. We affirm in all respects.
The dispute underlying the OPRA litigation regards the Hackensack
Planning Board's zoning determinations and ordinances adopted in the City's
redevelopment plan, which are the subject of two separate lawsuits involving
these parties. On August 12, 2019, plaintiff's counsel submitted two OPRA
requests "from Richard Malagiere." The first sought "[a]ny and all [emails]
relating to official business of the City of Hackensack, such as to constitute a
government record, to or from [the deputy mayor's personal email address] from
November 2017 through present[.]" The second sought "[t]ext messages,
[emails], and any other . . . correspondence" involving nine city officials and the
deputy mayor, about a particular planning board application and subsequent
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resolution and ordinance for a two-year time period. Karlsson denied the first,
calling it invalid because it failed "to identify the content and/or subject of the"
emails and would require the City to undertake an open-ended search. She
requested an extension to respond to the second. On August 28, 2019, plaintiff's
counsel submitted a third request seeking communications to and from the
deputy mayor's personal email account, narrowing the search terms to specific
words.
Karlsson provided seventeen pages of records in response to the second
request and thirteen pages for the third. She also submitted a Vaughn index1
explaining why certain records were withheld or redacted as privileged.
However, Karlsson declined to produce records responsive to seven search terms
generating over 400 emails, asserting "it is the City's position that any of the
above search terms producing more than 400 [emails] are too general for the
City to review" and would constitute an open-ended records search.
1
"[A] Vaughn index . . . is a detailed affidavit [submitted by the withholding
government entity] correlating the withheld documents with the claimed
exemptions. To pass muster, a Vaughn index must consist of one comprehensive
document, adequately describe each withheld document or redaction, state the
exemption claimed, and explain why each exemption applies." Cozen O'Connor
v. U.S. Dep't of Treasury, 570 F. Supp. 2d 749, 765 (E.D. Pa. 2008).
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Plaintiff's counsel filed a complaint in lieu of prerogative writs and an
order to show cause alleging defendants violated OPRA by: "(1) denying access
to records for search terms generating over 400 responsive [emails], and (2)
improperly asserting privileges and exemptions to withhold four categories of
[emails] responsive to the 'approved' search terms, when those [emails] should
have been provided along with the rest of [d]efendants' partial production . . . ."
Plaintiff sought in camera review of the privileged documents. Defendants
opposed the emergent application, arguing plaintiff's counsel lacked standing to
file the OPRA complaint, could not be awarded attorney's fees, and the requests
were properly denied as overly broad.
On January 9, 2020, Judge Bonnie J. Mizdol ordered defendants to
produce certain documents directly to plaintiff and to provide the privileged
documents—namely, emails between the deputy mayor and four city officials—
to the court. On February 13, 2020, following her in camera review, the judge
ordered defendant to produce three of the four categories of emails, but found
one category "wholly exempted from production under the deliberative process
and attorney-client privilege[.]" Plaintiff moved for $14,560.20 in counsel fees,
supported by an affidavit of services pursuant to N.J.S.A. 47:1A-6 and RPC
1.5(a).
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Defendants moved for reconsideration of the order requiring production
of the privileged materials. The judge granted reconsideration and reclassified
all categories of emails she reviewed in camera as privileged. She denied
plaintiff's request for counsel fees associated with the documents she reviewed
in camera.
In May 2020, plaintiff moved to compel production of the documents
ordered to be produced in January, and again sought counsel fees. Defendants
withheld a portion of the documents on grounds of privilege. Additionally, they
argued plaintiff lacked standing to seek counsel fees because the OPRA request
was submitted in the name of Malagiere, plaintiff's attorney. The judge ordered
defendants to produce the disputed records for in camera review.
Thereafter, the judge entered the July order, which is the subject of these
appeals, accompanied by a detailed forty-two-page written opinion. She
concluded nine of the ten documents withheld by defendants were protected
from disclosure by the deliberative process privilege and beyond the scope of
plaintiff's request; the tenth document was protected by the attorney-client
privilege.
Acknowledging that OPRA standing is not a "straightforward" issue, the
judge noted N.J.S.A. 47:1A-6 states: "'A person who is denied access to a
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government record by the custodian of the record, at the option of the requestor,
may institute a proceeding to challenge the custodian's decision,' and that '[t]he
right to institute any proceeding under this section shall be solely that of the
requestor.'" (alteration in original). However, she concluded plaintiff had
standing because plaintiff's counsel "has the power to act under implied
authority to handle matters on behalf of his client as long as he is given consent."
The judge also noted "the Government Records Council has addressed this
particular situation by way of its Denial of Access complaint form. That form
specifically states: 'If you are an attorney who requested records and are filing
this complaint on behalf of a client, please state the client's name.'" She
concluded "it is more than apparent here that an attorney may request documents
on behalf of a client and subsequently file suit under the client's name." She
concluded plaintiff could seek fees because plaintiff's counsel filed the OPRA
request on behalf of his client and within the scope of his representation.
The judge observed her January 2020 order
clarified the records that [p]laintiff was searching for,
it also narrowed the scope of the original request . . . .
Despite this narrowing, [d]efendants turned over 831
pages of records that had not been previously produced
pursuant to the August 28 request. Moreover, with
respect to the original request, the court finds it facially
apparent that [d]efendants' imposed limit of 400
responsive hits was arbitrary and capricious, especially
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in light of the fact that [one search term] produced 401
responsive records.
Thus, "the 831 pages of records would not have been effected[] but for
[p]laintiff's filing of suit in this case . . . and that [p]laintiff's success is limited
here to only the records that [d]efendants initially produced . . . pursuant to the
court's January . . . order."
The judge performed a lodestar analysis and addressed each RPC 1.5(a)
factor. At the outset, she noted plaintiff's counsel billed in quarter hour
increments and modified it to "the more widely-accepted six-minute billing
increment." The judge analyzed and reduced certain billing entries she found
excessive and concluded the remaining factors either favored an award of fees
or did not militate against it. Hence, "only the portion of attorneys' fees and
costs attributable to litigation of the original [order to show cause]" were
compensable because "no subsequent litigation has resulted in further
production of documents" and the purpose of the OPRA request was not
vindicated.
The judge found plaintiff's challenge to the 346-page Vaughn index
caused defendants to produce thirty-five pages and noted each page of the index
"addresses three entries on average, [and] the court extrapolates that
approximately 3,633 pages, representing approximately 1,038 documents [346
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x 3=1,038], were withheld from production." Therefore, she concluded "less
than [twenty percent] of the documents originally sought were actually
produced." The judge awarded plaintiff $3,750, or roughly one-half of the
lodestar amount.
I.
Our review of a trial court's interpretation of OPRA is de novo. See
O'Boyle v. Borough of Longport, 426 N.J. Super. 1, 8 (App. Div. 2012).
"Findings of fact, however, are reviewed deferentially." Ibid. (citing Rova
Farms Resort, Inc. v. Invs. Ins. Co., 65 N.J. 474, 484 (1974)).
"[A] reviewing court will disturb a trial court's award of counsel fees 'only
on the rarest of occasions, and then only because of a clear abuse of discretion.'"
Litton Indus., Inc. v. IMO Indus., Inc., 200 N.J. 372, 386 (2009) (quoting
Packard-Bamberger & Co. v. Collier, 167 N.J. 427, 444 (2001)). This is because
a "trial court [is] in the best position to weigh the equities and arguments of the
parties . . . ." Packard-Bamberger & Co., 167 N.J. at 447. We reverse only if
the award is "made without a rational explanation, inexplicably departed from
established policies, or rested on an impermissible basis." Flagg v. Essex Cnty.
Prosecutor, 171 N.J. 561, 571 (2002) (quoting Achacoso-Sanchez v. Immigr. &
Naturalization Serv., 779 F.2d 1260, 1265 (7th Cir. 1985)).
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II.
On appeal, plaintiff argues the judge erred by not releasing an email on
grounds of attorney-client privilege. Plaintiff contends defendants waived the
privilege by including a third party, the City's financial advisor, on the email.
Plaintiff also challenges the judge's calculation of counsel fees, alleging that she
considered "irrelevant and inappropriate factors" and should not have relied on
the number of documents produced to reduce the lodestar because many of
plaintiff's expenses were litigation costs rather than time billed. Plaintiff also
asserts the judge incorrectly concluded OPRA was not vindicated, yet the
lawsuit yielded additional documents.
On cross-appeal, defendants argue the judge should not have awarded
counsel fees because plaintiff did not prevail or demonstrate the documents were
released because of the lawsuit. Defendants also repeat their claim plaintiff did
not have standing to bring suit for an OPRA request it did not file. Defendants
urge us to consider "establish[ing] the standard that if an attorney is filing an
OPRA request on behalf of a client, it must clearly disclose that fact to the
custodian of records, or if the response proceeds to litigation the attorney must
be deemed the 'requestor.'"
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Standing
We affirm Judge Mizdol's ruling on standing for the reasons expressed in
her opinion. N.J.S.A. 47:1A-6 states:
A person who is denied access to a government record
by the custodian of the record, at the option of the
requestor, may:
institute a proceeding to challenge the custodian's
decision by filing an action in Superior Court . . . .
....
The right to institute any proceeding under this section
shall be solely that of the requestor.
Plaintiff's counsel filed the OPRA request on behalf of his client.
Defendants' claim counsel did not have authority to file the OPRA requests or
the subsequent suit after defendants denied the requests for records is
unsupported by the record. Counsel sought the records to further the underlying
litigation involving the same parties and counsel; therefore, counsel's role in
making the request was no mystery. This argument lacks merit. See R. 2:11-
3(e)(1)(E).
Furthermore, "OPRA is to be construed broadly to achieve the
Legislature's over-arching goal of making public records freely available[.]"
Scheeler v. Atl. Cnty. Mun. Joint Ins. Fund, 454 N.J. Super. 621, 625 (App. Div.
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2018). Moreover, "New Jersey courts always have employed 'liberal rules of
standing."' CFG Health Sys., LLC v. Cnty. of Hudson, 413 N.J. Super. 306, 314
(App. Div. 2010) (quoting Jen Elec., Inc. v. Cnty. of Essex, 197 N.J. 627, 645
(2009)). For these reasons, we decline to adopt defendants' literal reading of
N.J.S.A. 47:1A-6.
Attorney-Client Privilege
OPRA declares it is "the public policy of this State that: government
records shall be readily accessible for inspection . . . by the citizens of this State,
with certain exceptions, for the protection of the public interest[.]" N.J.S.A.
47:1A-1. One exception is the attorney-client privilege. N.J.S.A. 47:1A-1.1.
In pertinent part, the attorney-client privilege, provides "communications
between a lawyer and his client in the course of that relationship and in
professional confidence, are privileged. . . ." N.J.S.A. 2A:84A-20(1); N.J.R.E.
504(1).
The privilege "does not attach to a communication knowingly made within
the hearing of any person whose presence nullifies the privilege. . . . [T]he
privilege protects only those communications expected or intended to be
confidential." O'Boyle v. Borough of Longport, 218 N.J. 168, 185 (2014) (citing
N.J.R.E. 504(3). The privilege is not limited to legal advice but extends to
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"consultations with third parties whose presence and advice are necessary to the
legal representation." Ibid.We have explained the common interest exception and held a
communication with a third party may still be protected under the attorney client
privilege "if '(1) the disclosure is made due to actual or anticipated litigation;
(2) for the purposes of furthering a common interest; and (3) the disclosure is
made in a manner not inconsistent with maintaining confidentiality against
adverse parties.'" Laporta v. Gloucester Cnty. Bd. of Chosen Freeholders, 340
N.J. Super. 254, 262 (App. Div. 2001) (quoting Holland v. Island Creek Corp.,
885 F. Supp. 4, 6 (D.D.C. 1995); see also In re Bevill, Bresler & Schulman, 805
F.2d 120, 126 (3d Cir. 1986)).
We consider the purpose of asserting the privilege when determining
whether a specific communication between a client and an attorney is protected.
In re Custodian of Recs., Crim. Div. Manager, 420 N.J. Super. 182, 187 (App.
Div. 2011). The privilege should be strictly construed. Paff v. Div. of L., 412
N.J. Super. 140, 150-51 (App. Div. 2010) (citing In re Selser, 15 N.J. 393, 405-
06 (1954)).
Judge Mizdol found "the Vaughn index . . . indicated . . . a single email
by [the City's attorney] to Hackensack officials, representatives, or agents which
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was made in the course of [counsel's] legal representation of the city. . . . The
court's in camera review confirms this explanation." She concluded the
attorney-client privilege applied because "(1) the conversation was made with
the purpose of seeking or rendering legal advice, (2) [the financial advisor] was
copied on the email in his capacity as the City's financial planner on a matter
involving both legal and financial matters."
We affirm for the reasons expressed by the judge and reject plaintiff's
argument that applying the common interest test would lead to a different result.
The email communicated legal advice about the underlying planning board and
zoning ordinance litigation to city officials as a group and included the financial
planner in his official capacity. There is no evidence the communication was
intended to be public—the City's counsel and the financial planner filed
certifications to this effect.
Counsel Fees
We reject the parties' challenges to the counsel fee determination. OPRA
allows a prevailing party to receive "reasonable attorney's fee[s]." N.J.S.A.
47:1A-6 (emphasis added). "[T]he phrase 'prevailing party' is a legal term of art
that refers to a 'party in whose favor a judgment is rendered.'" Mason v. City of
Hoboken, 196 N.J. 51, 72 (2008) (quoting Buckhannon Bd. & Care Home, Inc.
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v. W. Va. Dep't of Health and Hum. Res., 532 U.S. 598, 603 (2001)). "A
plaintiff is considered a prevailing party 'when the actual relief on the merits of
[the] claim materially alters the relationship between the parties by modifying
the defendant's behavior in a way that directly benefits the plaintiff.'" Teeters
v. Div. of Youth and Fam. Servs., 387 N.J. Super. 423, 432 (App. Div. 2006)
(alteration in original) (quoting Warrington v. Vill. Supermarket, Inc., 328 N.J.
Super. 410, 420 (App. Div. 2000)).
In Mason, the Court held "requestors are entitled to attorney's fees under
OPRA . . . when they can demonstrate: (1) 'a factual causal nexus between
plaintiff's litigation and the relief ultimately achieved'; and (2) 'that the relief
ultimately secured by plaintiffs had a basis in law.'" Mason, 196 N.J. at 76(quoting Singer v. State, 95 N.J. 487, 494-95 (1984)). "The party does not need
to obtain all relief sought, but there must be a resolution that 'affect[s] the
defendant's behavior towards the prevailing plaintiff.'" Smith v. Hudson Cnty.
Reg., 422 N.J. Super. 387, 394 (App. Div. 2011) (alteration in original) (quoting
Teeters, 387 N.J. Super. at 432). Such action includes a "change (voluntary or
otherwise) in the custodian's conduct." Spectraserv, Inc. v. Middlesex Cnty.
Utils. Auth., 416 N.J. Super. 565, 583 (App. Div. 2010) (citing Teeters, 387 N.J.
Super. at 430-31).
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Here, the judge conducted a fact-sensitive inquiry, demonstrating plaintiff
was the prevailing party under the catalyst theory and was entitled to an award.
See Mason, 196 N.J. at 79. Plaintiff showed a causal nexus between the
litigation and results achieved because the suit caused defendants to release an
additional 831 documents. Moreover, plaintiff's suit modified defendants'
behavior to plaintiff's benefit. See Teeters, 387 N.J. Super. at 432.
Defendants' claims they would have responded to the revised OPRA
request without court intervention are unsupported by the record. As the judge
commented, defendants acted arbitrarily in capping the search hits to 400 per
term. The litigation and the court's order ultimately produced the information
sought in the OPRA request.
The judge's calculation of the lodestar and final fee amount was not an
abuse of discretion. In determining the fee award pursuant to fee-shifting
provisions, courts must determine the "lodestar" amount, which is "the number
of hours reasonably expended on the litigation multiplied by a reasonable hourly
rate." Litton Indus., 200 N.J. at 406 (quoting R.M. v. Sup. Ct. of N.J., 190 N.J.
1, 10 (2007)). The calculation includes a careful evaluation of the specific
hourly rates supporting the fee application. Rendine v. Pantzer, 141 N.J. 292,
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335 (1995). To determine the reasonableness of a fee, the trial court must weigh
the RPC 1.5(a) factors.
Our Supreme Court has stated: "The trial court should conduct a
qualitative analysis that weighs such factors as the number of documents
received versus the number of documents requested, and whether the purpose of
the OPRA was vindicated by litigation." New Jerseyans for a Death Penalty
Moratorium v. N.J. Dep't of Corr., 185 N.J. 137, 155 (2005). Vindication may
mean "acquiring that one smoking gun record hidden amongst hundreds of pages
or . . . it may be the absence of any records." Ibid. (internal quotations omitted).
The court should not rely "on percentages of documents obtained to determine
whether a reduction of the lodestar is appropriate in OPRA cases." Id. at 154.
A fee award "can be problematic" when a plaintiff obtains only partial
success. Id. at 153. As such, "courts [can] 'reduce the lodestar fee if the level
of success achieved in the litigation is limited as compared to the relief sought.'"
Id. at 154 (quoting Rendine, 141 N.J. at 336). "[A] reduction may be appropriate
if 'the hours expended, taking into account the damages prospectively
recoverable, the interests to be vindicated, and the underlying statutory
objectives, exceed those that competent counsel reasonably would have
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expended.'" Walker v. Guiffre, 209 N.J. 124, 132 (2012) (quoting Rendine, 141
N.J. at 336)).
We disagree with plaintiff's argument the judge relied on improper factors
in calculating the fee award. The judge conducted a careful review of the time
and costs billed by counsel and explained why she reduced the sums sought .
The judge's conclusion plaintiff did not vindicate OPRA was not fatal to
awarding fees. The purpose of OPRA "is to maximize public knowledge about
public affairs in order to ensure an informed citizenry and to minimize the evils
inherent in a secluded process." Times of Trenton Publ'g Corp. v. Lafayette
Yard Cmty. Dev. Corp., 183 N.J. 519, 535 (2005) (quoting Asbury Park Press
v. Ocean Cnty. Prosecutor's Off., 374 N.J. Super. 312, 329 (Law Div. 2004)).
The fee award reflects the partial success achieved by plaintiff, which is
compensable. New Jerseyans, 185 N.J. at 154.
The judge's calculation of the documents she concluded were improperly
withheld by defendants did not abrogate the Supreme Court's admonition that
trial courts should not rely on a percentage calculation of the record yielded by
the OPRA litigation to calculate fees. A thorough review of the record shows
the judge performed a qualitative analysis of plaintiff's counsel's billing when
she reduced the lodestar figure. Her findings were based on the substantial
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credible evidence in the record, thoroughly explained, and do not warrant our
intervention.
Affirmed.
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