BASCOM CORPORATION VS. PATERSON COALITION FOR HOUSING, INC. (F-011669-16, PASSAIC COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE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-3943-18
BASCOM CORPORATION,
Plaintiff-Respondent,
v.
PATERSON COALITION
FOR HOUSING, INC.,
Defendant-Appellant,
and
CITY OF PATERSON
DEPARTMENT OF COMMUNITY
DEVELOPMENT,
Defendant-Respondent,
and
FERRO LABELLA & ZUCKER,
LLC, STATES RESOURCES
CORPORATION, PUBLIC
SERVICE ELECTRIC & GAS
CO., THE UNITED STATES OF
AMERICA, and
STATE OF NEW JERSEY,
Defendants,
and
COMMUNITY ASSET
PRESERVATION CORPORATION,
Defendant/Intervenor-
Respondent.
______________________________
Argued March 24, 2021 – Decided August 24, 2021
Before Judges Fuentes and Firko
On appeal from the Superior Court of New Jersey,
Chancery Division, Passaic County, Docket No.
F-011669-16.
John Anthony Calzaretto argued the cause for appellant
Paterson Coalition for Housing, Inc. (Calzaretto &
Bernstein, LLC, attorneys; David R. Cubby, on the
briefs).
John C. Emolo, Assistant Corporation Counsel, argued
the cause for respondent City of Paterson (City of
Paterson Department of Law, attorneys; John C. Emolo,
on the brief).
Susan B. Fagan-Rodriguez argued the cause for
respondent Bascom Corporation (Robert A. Del
Vecchio, LLC, attorneys; Susan B. Fagan-Rodriguez,
of counsel and on the brief).
Stuart B. Klepesch argued the cause for
respondent/intervenor Community Asset Preservation
Corporation.
A-3943-18
2
PER CURIAM
Paterson Coalition for Housing (PCH) appeals from an order entered by
the Chancery Division, General Equity Part on April 1, 2019, denying its motion
under Rule 4:50-1 to vacate a final judgment of foreclosure entered on
September 21, 2017, of a tax sale certificate originally issued by the Tax
Collector of the City of Paterson (City) pursuant to N.J.S.A. 54:5-46, of the Tax
Sale Law1 and thereafter acquired by Bascom Corporation (Bascom). PCH filed
the motion to vacate six months after the January 2, 2018 sheriff's sale and more
than nine months after the trial court had entered a final judgment of foreclosure.
Community Asset Preservation Corporation (CAPC), the purchaser of the
property and intervenor in this appeal, had expended substantial funds to prepare
the property for redevelopment. Under these circumstances, and mindful of
prevailing legal standards, we hold that Judge Randal C. Chiocca correctly
found PCH was not entitled to any relief under the equitable doctrine of laches.
We also reject PCH's arguments attacking the soundness of Judge Chiocca's
decision to grant CAPC's motion to intervene in this case. As purchaser, CAPC
has an indisputable interest in the outcome of this litigation and was entitled to
protect and defend its interest, independent of the City.
1
N.J.S.A. 54:5-1 to -137.
A-3943-18
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I.
The property at issue here is located on Spruce Street and designated by
the City on its property tax map as Block 4802, Lot 20. The site was part of the
Great Falls Historic District. PCH purchased the property in October 1999 and
claimed that it had paid property taxes for the ensuing nine years. Part of the
property was used by PCH for its operations.
In October 2007, PCH applied for a property tax exemption based on its
status as a charitable organization. City of Paterson v. Paterson Coal. for Hous.,
Inc., No. A-2287-14 (App. Div. Feb. 23, 2017), slip op. at 1. The Passaic County
Board of Taxation granted an exemption, but only for the second half of 2008
and the first half of 2009. Ibid. PCH refused to pay taxes on the property for
the second half of the 2009 tax year. On June 25, 2009, the City issued a tax
sale certificate to recover the outstanding property taxes. Royal Tax Lien
Services (Royal) purchased the certificate. Id. at 2. In August 2009, the City
appealed in the Tax Court the Passaic Board of Taxation's decision to grant a
one-year property tax exemption to PCH. Ibid. In response, PCH argued the
property had been declared exempt from taxation, and the exemption should
have been extended for at least three years.
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On June 26, 2013, the City purchased tax sale certificate No. 2014-2772,
issued by the County tax collector, for $44,906 for unpaid property taxes and
sewer charges on the property. The City prevailed in all respects before the Tax
Court, which granted the City's motion to have PCH's complaint dismissed with
prejudice. Ibid. The court rejected PCH's cross-motion to invalidate the tax sale
certificate and to apply the Freeze Act, N.J.S.A. 54:51A-8, to the two years
succeeding the one-year exemption. This court affirmed the Tax Court's
December 5, 2014 order. We also held that "the parties may return to the
Chancery Division to consider [PCH's] challenge to the validity of the tax lien
and tax sale certificate . . . [and] express[ed] no view as to the merits of that
challenge." Id. at 12.
By letter dated March 9, 2016, Bascom informed PCH that it intended to
obtain the City's Council's approval to acquire a lien on the property. Unless
PCH redeemed the property by paying the outstanding taxes and interest in the
amount of $209,093.31 within thirty days, Bascom would initiate foreclosure
proceedings. The letter was sent by certified mail to PCH's office. PCH's
Executive Director Therese Tolomeo signed the attached card acknowledging
its receipt.
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On April 26, 2016, Bascom filed a foreclosure action on the property and
sought to bar PCH's right of redemption.2 PCH was served with process on June
27, 2016. It did not file a responsive pleading or seek to participate in any other
form. On August 8, 2016, Bascom moved for the entry of a default judgment.
The court entered a final judgment by default on October 13, 2016. The court
vacated the judgment on October 28, 2016, when it discovered that PCH had
filed an objection to the final judgment on October 11, 2016. The objection did
not appear in the system at the time the court entered the initial judgment.
On April 17, 2017, the judge assigned to the case at the time signed an
order granting Bascom's motion to strike PCH's objection to the judgment and
declared the matter uncontested. Bascom thereafter moved for an order entering
final judgment. On May 31, 2017, the same judge again signed an order striking
PCH's objection to the entrance of a final judgment and deemed the matter to be
uncontested. On June 13, 2017, Bascom again filed a notice of motion for the
entry of final judgment. On September 21, 2017, the judge signed a final
judgment and a writ of execution.
2
Bascom named several other defendants who appear to also hold liens on the
property. None of these putative parties responded or otherwise participated at
the trial level or in this appeal.
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In a certification submitted to the court, CAPC's Director Michael
DeBlasio averred that he attended the sheriff's sale scheduled on November 21,
2017, and was informed that the sale had been postponed at PCH's request. He
also averred that, prior to the scheduled sale, neither he nor anyone in the
organization had been in contact with Bascom. CAPC was at the time a non-
profit organization whose primary goal was to acquire vacant and abandoned
property with the intention of revitalizing urban municipalities throughout the
State.
The sheriff's sale finally took place on January 3, 2018. CAPC was the
highest bidder at $279,000. CAPC's attorney Stewart Klepesch submitted a
certification in which he averred that a title search conducted in early 2018
revealed two tax sale certificates from sales in June 2016 and June 2017. CAPC
took title to the property subject to these certificates. According to Klepesch,
the sale was conducted "under a writ of execution on behalf of Bascom
Corporation's judgment in the foreclosure of tax sale certificate No. 2014-2772."
CAPC paid the full balance of the bid price. On January 16, 2018, it received
the deed of conveyance from the sheriff's office. The deed was recorded on
February 16, 2018.
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According to PCH's Executive Director Tolomeo, the City and its former
Mayor Joey Torres had historically opposed PCH's ownership of this particular
property. Tolomeo claimed that the attorney who represented her at the time
failed to inform her of the status of the case and did not notify her that a final
judgment had been entered and the property had been sold. According to
Tolomeo, the attorney only told her that the November 2017 sheriff's sale had
been adjourned.
On June 27, 2018, PCH filed a motion to vacate the September 21, 2017
final judgment of foreclosure and the January 2018 sheriff's sale, pursuant to
Rule 4:43-3 and Rule 4:50-1. PCH also filed a notice of lis pendens on October
25, 2018. In September 2018, the City moved for summary judgment. The court
granted CAPC's motion to intervene on March 4, 2019. On March 27, 2019,
Judge Chiocca heard oral argument from counsel and rendered an oral decision
denying PCH's motion to vacate the judgment. The judge signed an order dated
April 1, 2019, denying the motion to vacate the foreclosure judgment and the
sheriff's sale and a separate order granting the motion to discharge the notice of
lis pendens.
Judge Chiocca found that PCH was aware of the foreclosure sale because
it had twice written to the sheriff's office seeking an adjournment of the sale .
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He also concluded that PCH did not present any basis from to find excusable
neglect. The judge provided the following explanation for his finding:
Service of the summons and complaint subsequently
were delivered to [PCH's] registered agent at what
appears to be his home address.
Subsequently . . . and . . . significantly, in the Court's
view, Mr. Anastasio was retained and actually filed
pleadings in the action, [and] at least two objections to
the entry of final judgment. He sought stays of the
sheriff's sale. And he knew, and therefore [PCH] knew,
that a sale was going to occur.
There was no motion for reconsideration . . . of the
entry of final judgment. There was no appeal taken.
The judge also rejected PCH's allegation of "fraud and illegal activity
based on some sort of politically-based conspiracy," which allegedly included
Bascom and CAPC. Judge Chiocca found no evidence of a nefarious interaction
between CAPC and Bascom and characterized PCH's claims in this respect as
"sheer speculation and innuendo."
The property was not tax exempt and therefore ineligible for sale. PCH
lost ownership of the property when it "failed to pay the taxes or challenge the
assessment that led to the taxes that are the subject of the tax sale certificate
which is the basis of this action. Therefore, [it] is stuck with the assessment that
was determined by the [C]ity." Under these circumstances, the judge found:
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The [C]ity had an absolute right to sell the tax sale
certificate, and Bascom had the right to purchase same,
Otherwise, the [C]ity would not have a mechanism to
collect unpaid taxes.
[PCH's] challenges to the tax sale certificate process
employed in this case . . . are no longer viable. [PCH]
had the opportunity to raise defenses prior to the sale.
To the extent that issues were raised, those issues were
decided. The challenges are also barred by N.J.S.A.
54:5-52 . . . which puts the burden on the defendant to
overcome the presumption of validity.
Finally, the judge held that PCH's claims were barred by the doctrine of
laches because PCH had an attorney who had both the ability and responsibility
to "make whatever applications or challenge the actions of the [c]ourt that went
on during that period of time. And that's also true as to making a motion to
vacate . . . the final judgment that ultimately was entered by the [c]ourt." PCH
not only sat on its rights, and delayed acting during the time the sale and
conveyance of the property took place. The judge thus concluded:
[CAPC] purchased the property for $279,000, paid for
the title work, paid for the architectural services,
engineering, paid for a survey . . . plus some additional
taxes, $353,034 [in total]. [CAPC] [a]lso obtained a
loan commitment in order to revitalize the property and
move forward with redevelopment.
And there's a consequence as a result of the failure to
move forward in order to challenge the final judgment
prior to the sale. Therefore, the court will deny the
motion to vacate the sheriff's sale and . . . the final
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judgment. And, consequently, I will grant the motion
to discharge the lis pendens.
II.
PCH argues that the court erred in applying the doctrine of laches because
it failed to specify what defenses or claims were barred. It also argues that its
claim of fraud should not have been barred because CAPC did not incur any
expenses until after PCH's motion to vacate had been filed, and PCH retained an
interest in the property by way of Bascom's lien. We reject these arguments
because the record shows that Judge Chiocca did not abuse his discretion when
he applied the doctrine of laches in this case. PCH waited six months after the
sheriff's sale, and nine months after the final judgment of foreclosure to file its
motion to vacate. PCH was well aware of the sale during which time CAPC
incurred expenses. Our standard of review in these matters are well-settled.
A court may set aside a judgment of default in accordance with Rule 4:50-
1 for good cause shown. R. 4:43-3. Under Rule 4:50-1, a judgment may be set
aside as a result of mistake, fraud, or any other reason justifying relief. A trial
court's determination to grant or deny any relief under Rule 4:50-1 warrants
substantial deference and should not be reversed unless it results in a clear abuse
of discretion. U.S. Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467 (2012).
An abuse of discretion will be found when a decision is made without a rational
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explanation, inexplicitly departed from established policies, or rested on an
impermissible basis. Ibid. This standard specifically applies to motions to
vacate foreclosure judgments and related sheriff's sales. United States v. Scurry,
193 N.J. 492, 502 (2008).
The General Equity Part has the power to vacate a foreclosure sale based
on considerations of equity and justice. Crane v. Bielski, 15 N.J. 342, 346
(1954). However, this power should be used sparingly and only to correct a
plain injustice or injury, such as fraud, accident, surprise or irregularity in the
sale. Midfirst Bank v. Graves, 399 N.J. Super. 228, 232 (Ch. Div. 2007). As
with Rule 4:50-1, the court's determination will be left undisturbed unless it
constitutes a clear abuse of discretion. Town of Phillipsburg v. Block 1508, Lot
12, 380 N.J. Super. 159, 173 (App. Div. 2005).
Laches is an equitable doctrine which operates as an affirmative defense
that precludes relief when there is an unexplainable and inexcusable delay in
exercising a known right, which results in prejudice to another party. Fox v.
Millman, 210 N.J. 401, 417 (2012). It is an equitable defense that may be
interposed in the absence of the statute of limitations. Id. at 418. Laches may
only be enforced when the delaying party had sufficient opportunity to assert
the right in the proper forum and the prejudiced party acted in good faith in
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believing that the right had been abandoned. Ibid. Whether laches should be
applied depends upon the facts of the particular case and is a matter within the
sound discretion of the trial court. Ibid. The key factors to be considered in
deciding whether to apply the doctrine of laches are the length of the delay, the
reasons for the delay, and the changing conditions of either or both parties
during the delay. Knorr v. Smeal, 178 N.J. 169, 181 (2003). The core equitable
concern is whether a party has been harmed by the delay. Ibid.At this point, some background regarding the Tax Sale Law is useful.
The Tax Sale Law serves as a framework to facilitate
the collection of property taxes. It confers on a
municipality that is owed real estate taxes a continuous
lien on the land for the delinquent amount as well as for
all subsequent taxes, interest, penalties and costs of
collection. The Tax Sale Law converts that lien into a
stream of revenue by encouraging the purchase of tax
certificates on tax-dormant properties. By authorizing
the sale of liens in a commercial market, the Tax Sale
Law gives rise to a municipal financing option that
provides a mechanism to transform a non-performing
asset into cash without raising taxes.
[In re Princeton Office Park L.P. v. Plymouth Park Tax
Servs., LLC, 218 N.J. 52, 61-62 (2014) (internal
citations omitted).]
As codified by the Legislature, the Tax Sale Law is "a remedial statute
and to operate both prospectively and retrospectively, and be liberally construed
to effectuate the remedial objects thereof." N.J.S.A. 54:5-3 The underlying
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purposes of tax sale certificates are to secure marketable titles to land, thereby
maximizing the recovery of unpaid municipal taxes and other municipal charges,
and to quickly return to the tax rolls the property on which such charges have
remained in default. Town of Phillipsburg, 380 N.J. Super. at 162.
The purchaser of a certificate for unpaid taxes does not have title to the
land, but has a lien interest derived from the taxing district. Jefferson Township
v. Block 447A, Lot 10, 228 N.J. Super. 1, 4 (App. Div. 1988). The holder has
the right to receive the sum paid for the certificate with interest at the redemption
rate for which the property was sold. Ibid. In addition, the holder has the right
to acquire title by foreclosing if the delinquent owner does not redeem the
certificate within two years from the date of the sale. Id. at 4-5. However, the
property owner has the right to redeem at any time up to the entry of final
judgment. Simon v. Cronecker, 189 N.J. 304, 319 (2007). "A subsequent tax
sale certificate . . . has priority over an earlier certificate, and the foreclosure of
the later certificate can extinguish the earlier certificate." Cherokee LCP Land,
LLC v. City of Linden Planning Bd., 234 N.J. 403, 425 (2018), (quoting Lato v.
Rockaway Township, 16 N.J. Tax 355, 363 (Tax 1997)). After a judgment of
foreclosure is entered, "no application shall be entertained to reopen the
judgment after three months from the date thereof, and then only upon the
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grounds of lack of jurisdiction or fraud in the conduct of the suit." N.J.S.A.
54:5-87.
PCH claims that laches is not applicable because its claim is based on
fraud, which has a six-year statute of limitations. Even where there is an
applicable statute of limitations, there is a role for the equitable doctrine of
laches. Fox, 210 N.J. at 419. Laches will ordinarily be utilized in suits brought
in equity; statutes of limitation, although not ignored, have no obligatory
application in such suits. Id. at 420. Actions to foreclose and bar the right of
redemption are actions in equity. N.J. Mortg. & Inv. Corp. v. Young, 134 N.J.
Super. 392, 398 (Law Div. 1975). Therefore, the statute of limitations for fraud
did not bar application of the laches doctrine in this case. Ultimately, the
dispositive weakness in PCH's fraud argument is that it has not presented any
competent evidence of fraud. Its claims that CAPC did not incur any expenses
until after the motion to vacate had been filed is baseless. PCH does not have
any legal support for its claim that it retained an interest in the propert y by way
of Bascom's tax sale certificate, or that that interest would prelude laches.
PCH's remaining arguments lack sufficient merit to warrant discussion in
a written opinion. R. 2:11-3(e)(1)(E). We only briefly note that PCH contends
that the court erred in permitting the City, Bascom, and CAPC to oppose its
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motion to vacate because each party failed to submit certifications in opposition
to the motion. Under Rule 1:6-2(a), a motion "shall be deemed uncontested and
there shall be no right to argue orally in opposition unless responsive papers are
timely filed and served stating with particularity the basis of the opposition to
the relief sought." However, PCH fails to disclose where in the record it sought
to bar respondents' opposition pursuant to Rule 1:6-2(a) for failing to file
certifications. It is long-established that an issue not raised before the trial court
will not be addressed on appeal unless it involves an issue of great public
importance or goes to the jurisdiction of the trial court. Nieder v. Royal Indem.
Ins. Co., 62 N.J. 229, 234 (1973). PCH fails to come close to satisfying this
standard of review.
III.
We cannot conclude our analysis, however, without addressing an
important and disturbing issue, the obstreperous conduct and disrespectful
demeanor displayed by PCH's trial counsel to Judge Chiocca. To be clear, we
are not referring to PCH's appellate counsel. The record of the oral argument
shows PCH's trial attorney repeatedly interrupted Judge Chiocca as he was
delivering his oral decision from the bench and intentionally ignored the many
requests by both the Sheriff's Officer assigned to the courtroom and by the Judge
A-3943-18
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himself to stop interrupting his presentation of his ruling. The attorney finally
stopped only when the Judge admonished him that "if you interrupt my rendering
of the decision, I'm going to ask you to please leave."
The following excerpt illustrates counsel's unprofessional conduct.
THE JUDGE: The allegations, particularly as to -- well,
with regard to Community Asset, as to any knowledge
or involvement in any type of scheme to interfere with
Paterson Coalition, or to engage in any type of
politically-based conspiracy is -- is just sheer
speculation and innuendo.
[ATTORNEY FOR PCH]: Unbelievable. Unbelievable.
SHERIFF'S OFFICER: Sir?
[ATTORNEY FOR PCH]: I mean you’re -- we’re just
going to -- we’re just going to -- we’re just going to --
SHERIFF'S OFFICER: Sir?
[ATTORNEY FOR PCH]: -- we just going to maneuver
--
THE COURT: All right.
SHERIFF'S OFFICER: The Judge is making a decision
--
THE COURT: No.
SHERIFF'S OFFICER: -- and you’ve got to --
[ATTORNEY FOR PCH]: I -- I would like to reflect for
the record that the Passaic County Sheriff’s Officer --
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SHERIFF'S OFFICER: No.
[ATTORNEY FOR PCH]: -- has twice come over to
this --
SHERIFF'S OFFICER: Sir, please?
[ATTORNEY FOR PCH]: -- counter while I am sitting
down, well under control to threaten me for speaking
against --
SHERIFF'S OFFICER: Let's –
[ATTORNEY FOR PCH]: -- what the Judge is putting
onto the record.
SHERIFF'S OFFICER: -- I'm not threatening you, sir.
The Judge is making a decision.
[ATTORNEY FOR PCH]: I disagree, officer. I believe
that you have walked over here twice now --
THE COURT: All right. You know what, all right.
[ATTORNEY FOR PCH]: -- to -- to prevent me from
speaking on –
SHERIFF'S OFFICER: Sir?
[ATTORNEY FOR PCH]: -- the record –
SHERIFF'S OFFICER: Sir?
[ATTORNEY FOR PCH]: -- in this matter. Twice.
THE COURT: [Addresses counsel by his last name]
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SHERIFF'S OFFICER: Then, sir --
THE COURT: please control yourself.
SHERIFF'S OFFICER: Counsel --
THE COURT: The . . . officer is charged with --
[ATTORNEY FOR PCH]: I -- I have a hard time
controlling myself when I see the law being distorted to
benefit parties that did wrong.
SHERIFF'S OFFICER: Sir?
[ATTORNEY FOR PCH]: I have a very big problem
with that –
THE COURT: Okay.
[ATTORNEY FOR PCH]: -- and will continue to do so.
THE COURT: Either you can sit there and listen to my
decision or you can leave, [addressing counsel by his
last name].
[ATTORNEY FOR PCH]: Your . . . decision is -- is --
is -- is extrajudicial. There's nothing here -- it’s not
based on anything.
THE COURT: All right. Would you like to leave?
[ATTORNEY FOR PCH]: Oh, I would like to listen to
it because we are going to have to appeal it at -- at some
point, obviously, which is just another kick in the face
to my client --
THE COURT: You're being --
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[ATTORNEY FOR PCH]: - who did nothing but serve
this city and now will have to appeal against -- against
these clowns based on absolutely nothing.
SHERIFF'S OFFICER: Sir?
THE COURT: Mr. -- Mr. -- no, no, no. One -- no, I
don’t want anybody to say anything. [addressing
counsel by his last name], you’re acting in [an]
extremely unprofessional and unreasonable manner.
I'm going to ask you to please refrain from making
comments. If you disagree with the [c]ourt’s decision,
which obviously you do --
[ATTORNEY FOR PCH]: I request the [c]ourt then to
put -- to put statements of fact on the record rather than
making conclusions that --
THE COURT: [Addresses counsel by his last name]
[ATTORNEY FOR PCH]: -- that my conspiracy
theories are not supported by evidence.
THE COURT: [Addresses counsel by his last name],
I'm going to ask you one more time. If you interrupt
me, you're going to be asked to leave, please . . . .
At this point, the judge again made detailed findings of the procedural
history of the case and restated the substantive analysis that supported the
ultimate ruling denying PCH's applications. At the conclusion of this recitation,
the judge addressed the attorneys present in the courtroom, including attorney
for PCH, as follows:
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THE COURT: the [c]ourt will deny the motion to
vacate the sheriff’s sale and the . . . final judgment.
And, consequently, I will grant the motion to discharge
the lis pendens. I will sign orders. They will be
uploaded in eCourts. All right. Okay. Gentlemen, I’ll
send the order out short[ly].
[ATTORNEY FOR PCH]: Your Honor, regarding the
certified mail notice of the assignment sale, what was -
- what was the [c]ourt's findings on that? I -- I -- that -
- that my client received a notice of assignment sale by
certified mail?
THE COURT: My findings are reflected in the record.
[ATTORNEY FOR PCH]: And I am asking the [c]ourt
to substantiate [its] findings because I -- I am unclear
on that.
THE COURT: All right.
[ATTORNEY FOR PCH]: And the certifications before
the [c]ourt don't say that my client received a --
THE COURT: Okay. All right. All right, [addressing
counsel by his last name]. All right, gentlemen.
[ATTORNEY FOR PCH]: So you don't -- so Your
Honor, you're cutting off conversation here and
walking out of the room when my client is asking for
specific findings of law and facts –
....
Is the [c]ourt denying -- . . . -- my client’s right to have
specific -- . . . findings of law –
THE COURT: -- I've rendered my ruling.
A-3943-18
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[ATTORNEY FOR PCH]: and fact on the record?
THE COURT: Have a nice day, everyone.
[ATTORNEY FOR CITY OF PATERSON]: Thank
you.
[ATTORNEY FOR PCH]: Yeah. My point is you're
corrupt, that's my point.
[(Emphasis added).]
The attorney for PCH continued this unprofessional diatribe even after the
judge had left the bench. The audio recording equipment in the courtroom
captured the attorney for PCH make the following menacing statement to one of
the attorneys in the case: "Whoa. Whoa. I'm coming after you, too, counsel."
Pursuant to its exclusive constitutional role and authority under N.J.
Const. art. VI, § 2, ¶ 3, the Supreme Court promulgated the Rules of Professional
Conduct (RPC), the ethical guidelines that regulate the practice of law. RPC
3.5(c) emphatically states: "A lawyer shall not . . . engage in conduct intended
to disrupt a tribunal[.]" RPC 8.4(a) to (g), delineates seven distinct types
activities or behavior that constitute "professional misconduct for a lawyer." Of
particular relevance here, RPC 8.4(d) states: "it is professional misconduct for a
lawyer to . . . engage in conduct that is prejudicial to the administration of
justice[.]"
A-3943-18
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As an intermediate appellate court, we do not have the authority to
determine whether PCH's attorney's conduct before Judge Chiocca constitutes
an ethical violation. However, pursuant to the Code of Judicial Conduct, Canon
3.15(b):
A judge who receives reliable information indicating a
substantial likelihood that a lawyer has committed a
violation of the Rules of Professional Conduct should
take appropriate action. A judge having knowledge that
a lawyer has committed a violation of the Rules of
Professional Conduct that raises a substantial question
as to the lawyer's honesty, trustworthiness or fitness as
a lawyer in other respects shall inform the appropriate
authority.
We thus adhere to our ethical obligation as judges and refer this matter to
the Office of Attorney Ethics to investigate and take any action it deems
appropriate under these circumstances. Our decision in this respect in no way
questions the dignified manner Judge Chiocca chose to deal with PCH's trial
counsel's disruptive conduct. Indeed, Judge Chiocca displayed remarkable
composure in the face of PCH's trial counsel's unrelenting discourteous
behavior. However, our role as appellate judges allows us to examine the record
of what occurred from a different vantage point. We have the opportunity to
read the verbatim account of what transpired in the courtroom unburdened by
the pressure of responding in real time. And perhaps most importantly, unlike
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the federal judges who serve in the Circuit Courts of Appeal, all of us in the
appellate division are former trial judges. We are keenly aware of the pressures
and inherent difficulties involved in the management of a courtroom. That is
why we must support our colleagues at the trial level when events like the one
we have described here undermine their dignity and disrupt the orderly
administration of our trial courts.
Affirmed.
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