STATE OF NEW JERSEY VS. LUIS HERNANDEZ(04-03-0323, 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NOT FOR PUBLICATION WITHOUT THE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-3042-15T2
LINDEN MEDICAL ASSOCIATES, P.C.,
Plaintiff-Respondent,
v.
EBELE NNEKA ILOGU,
Defendant-Appellant.
_______________________________
Submitted March 30, 2017 - Decided May 8, 2017
Before Judges Lihotz and Hoffman.
On appeal from Superior Court of New Jersey,
Law Division, Middlesex County, Docket No. L-
4775-15.
John C. Uyamadu, attorney for appellant.
Rajan & Rajan, LLP, attorneys for respondent
(Jordan B. Dascal and Oscar A. Escobar, Jr.,
of counsel and on the brief).
PER CURIAM
Defendant Ebele Nneka Ilogu appeals from three Law Division
orders: a November 24, 2015 order entering default judgment when
she failed to respond to plaintiff's complaint alleging breach of
contract; a February 5, 2016 order denying her motion to vacate
the default judgment; and a March 18, 2016 order denying her motion
for reconsideration. On appeal, defendant maintains the Law
Division judge erroneously refused to vacate the default judgment
despite her challenges, plaintiff failed to abide the arbitration
clause in the agreement, and the consequential damages clause is
unconscionable. Following our review of the arguments presented,
in light of the record and applicable law, we conclude defendant
failed to satisfy the requirements of Rule 4:50-1. Accordingly,
we deny her request to vacate default judgment.
Defendant, a nurse practitioner, began working for plaintiff,
Linden Medical Associates, M.D., P.C., on a per diem basis.
Shortly thereafter, the parties executed a two-year employment
contract "commencing on July 15, 2014."1 Defendant employed an
attorney to review the employment contract prior to her execution.
Under the terms of the contract, defendant was paid a salary,
provided two weeks paid vacation, permitted satisfaction of
professional fees, given up to $5000 in reimbursement for personal
health insurance, and was included on plaintiff's malpractice
1 The record contains a per diem contract and an employment
contract, both of which contain a date adjacent to defendant's
signatures of June 24, 2014. However, the parties suggest the
two-year employment contract under review actually was signed on
July 16, 2014, and backdated to the date defendant started
employment.
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insurance. The contract stated either party may terminate the
agreement with ninety days written notice, upon a material breach
of its terms. Additionally, in the event of a dispute, the
contract contained an arbitration clause.2 Finally, the agreement
contained two liquidated damages provisions: first, if defendant
resigned before the end of the contract term, plaintiff was
entitled to $20,000 as liquidated damages; and second, if defendant
resigned upon less than ninety days' notice, plaintiff was entitled
to an additional $20,000.
Giving approximately one month's notice, defendant submitted
her resignation, effective March 31, 2015.3 Plaintiff filed a
four-count complaint on August 12, 2015, alleging breach of
contract, breach of the covenant of good faith and fair dealing,
misrepresentation and fraud, and tortious interference with
2 Many of defendant's arguments are premised on plaintiff's
failure to comply with the agreement's arbitration clause. We do
note the clause as drafted contains misstatements, such as invoking
the New Jersey State Arbitration Code and providing venue for "any
litigation will be the Circuit Court of Elizabeth in Union County."
Nevertheless, for the reasons stated in our opinion, we affirm the
orders and judgment making it unnecessary to consider the
arbitration clause.
3 Plaintiff references defendant filed a claim with the
Department of Labor (DOL), seeking alleged vacation pay, which
plaintiff states was dismissed at a December 21, 2015 hearing "for
lack of merit."
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contractual relations. Plaintiff demanded $40,000 as liquidated
damages.
Plaintiff proved the complaint was personally served.
Defendant did not respond and ignored plaintiff's follow-up call
and correspondence.
Plaintiff moved for entry of default and submitted proofs
supporting its damage request. Judge Arthur Bergman entered
default judgment on November 24, 2015, which required defendant
to pay plaintiff $44,255.90, consisting of liquidated damages,
prejudgment interest, attorney's fees and costs of suit.
On December 31, 2015, defendant moved to vacate the default
judgment. Defendant maintained plaintiff failed to serve the
request for default, did not comply with the agreement's
arbitration provision, breached the agreement by switching her
hours and not affording necessary training, and asserted the
liquidated damage clause was punitive. Following extensive oral
argument, Judge Bergman concluded defendant did not prove
excusable neglect. In fact, he found she offered no explanation
for her failure to answer. The February 5, 2016 order denied
defendant's motion to vacate the judgment.
Defendant requested reconsideration, asserting her failure
to respond after receipt of the complaint resulted from an
inability to retain counsel. Identifying contradictions in
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defendant's certification filed in support of her motion, Judge
Bergman stated her "certification is disingenuous at best,
untruthful at worst." He concluded:
And I have no . . . basis whatsoever to
. . . understand why she didn't file an answer,
between the time she called the attorney for
plaintiff to say, well, she's having trouble
getting a lawyer and the four notices, that
they [sic] gave her extra time, . . . told her
they're going to default her, and they default
her and they got a default judgment.
The whole period of time, that's several
months. . . . [W]henever [counsel was]
retained, it was December, . . . she never
responded at all. She could have just picked
up the phone and called, could have written a
letter. She was certainly capable of filing
the complaint for overtime. And she's telling
us she's not capable of filing an answer.
I have no reason why. I have no
explanation why. And that's it. You've had
two bites at the apple. That's all the apple
you're going to bite. So, the motion is
denied.
Defendant moved to stay the judgment and filed a timely notice
of appeal. Judge Bergman denied the request for stay, and
defendant's emergent application to this court seeking a stay
pending appeal was also denied.
The standards guiding a trial judge's consideration of a
request to vacate a default judgment, as well as the standards
guiding our review of the resultant order, are well-defined. A
party must present evidence showing the failure to file timely
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responsive pleadings was the result of excusable neglect, and must
also assert the existence of a "meritorious defense." US Bank
Nat'l Ass'n v. Guillaume, 209 N.J. 449, 469 (2012); see also,
Morales v. Santiago, 217 N.J. Super. 496, 501 (App. Div. 1987)
("[A] defendant seeking to reopen a default judgment must show
that the neglect to answer was excusable under the circumstances
and that he [or she] has a meritorious defense.") (quoting Marder
v. Realty Constr. Co., 84 N.J. Super. 313, 318 (App. Div.), aff’d,
43 N.J. 508 (1964)).
When the matter has proceeded to the second
stage and the court has entered a default
judgment pursuant to Rule 4:43-2, the party
seeking to vacate the judgment must meet the
standard of Rule 4:50-1 . . . .
The rule is "designed to reconcile the strong
interests in finality of judgments and
judicial efficiency with the equitable notion
that courts should have authority to avoid an
unjust result in any given case." Mancini v.
EDS, 132 N.J. 330, 334 (1993) (quoting Baumann
v. Marinaro, 95 N.J. 380, 392 (1984)).
The trial court's determination under the rule
warrants substantial deference, and should not
be reversed unless it results in a clear abuse
of discretion. See DEG, LLC v. Twp. of
Fairfield, 198 N.J. 242, 261 (2009); Hous.
Auth. of Morristown v. Little, 135 N.J. 274,
283 (1994). The Court finds an abuse of
discretion when a decision is "made without a
rational explanation, inexplicably departed
from established policies, or rested on an
impermissible basis." Iliadis v. Wal-Mart
Stores, Inc., 191 N.J. 88, 123 (2007) (quoting
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Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561,
571 (2002)).
[Guillaume, supra, 209 N.J. at 467-68.]
Defendant urges we vacate the default judgment, along with
the subsequent orders, by suggesting the arbitration clause
precludes adjudication of plaintiff's complaint in the Superior
Court. Alternatively, defendant contends the "Circuit Court of
Elizabeth" refers to the Superior Court, Union County. Defendant
maintains the liquidated damage provisions were unconscionable,
making them void ab initio and unenforceable. Finally, she
challenges the substance of plaintiff's proofs as insufficient to
support the judgment.
What remains absent from defendant's presentation is the
basis underlying her failure to answer. Defendant's bald
invocation, suggesting justice requires the default judgment be
vacated, ignores the very clear procedural requirements of Rule
4:50-1.
"'Excusable neglect' may be found when the default was
'attributable to an honest mistake that is compatible with due
diligence or reasonable prudence.'" Guillaume, supra, 209 N.J.
at 468 (quoting Mancini, supra, 132 N.J. at 335). Our precedents
make clear, "mere carelessness" is insufficient. Ibid. (quoting
Baumann, supra, 95 N.J. at 394). Absent demonstrable excusable
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neglect, we need not examine the matter further. Rather, this
court must affirm the denial of the motion to vacate. Id. at 469.
Here, defendant was properly served with the complaint,
accompanied by a summons instructing the time to answer. She
called plaintiff's counsel and was granted additional time to
search for a legal representative and to answer. Defendant
disregarded plaintiff's follow-up letters, dated October 7, 2015
(advising default would be requested if she did not respond by
October 16), October 22, 2015 (informing her default was
requested), and November 11, 2015 (seeking entry of default
judgment). Pursuant to the requirements of Rule 4:43-1 and Rule
4:43-2, plaintiff mailed defendant its submissions for entry of
default and default judgment by first class and certified mail.
No additional notice is required. See Dynasty Bldg. Corp. v.
Ackerman, 376 N.J. Super. 280, 285 (App. Div. 2005) (declining to
set aside default despite flawed notice, absent prejudice to the
defendant). Further, defendant initiated DOL administrative
proceedings to seek vacation pay, reflecting her level of
sophistication in pursuit of redress. She offers no reason for
not contacting plaintiff or the court seeking additional time to
respond to plaintiff's complaint.
Arguments challenging venue cannot suffice as supporting
excusable neglect, nor can defendant's allegations the liquidated
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damages were unconscionable. Defendant's failure to show
excusable neglect defeats her request to vacate the default
judgment.
We also reject as lacking merit, R. 2:11-2(e)(1)(E), the
claim awarded damages were not sufficiently proven by plaintiff
because the judge did not conduct a proof hearing. See Morales,
supra, 217 N.J. Super. at 505 (stating the necessity of a proof
hearing rests with the discretion of the trial judge).
We conclude Judge Bergman afforded defendant many
opportunities to support her request to vacate the default
judgment. However, she could not demonstrate excusable neglect;
rather, the record shows she ignored plaintiff's complaint.
Affirmed.
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