AGNIESZKA DELA VS. LONG ISLAND AUTO FIND, INC. (L-3734-15, 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NOT FOR PUBLICATION WITHOUT THE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-0786-17T4
AGNIESZKA DELA and MARIA
DELA,
Plaintiffs,
v.
LONG ISLAND AUTO FIND, INC.,
and BRIAN KEEGAN,
Defendants-Respondents,
and
KATELYN KELLEY, OWNERSHIELD,
INC., and HUDSON INSURANCE
COMPANY,
Defendants,
and
WESTERN SURETY COMPANY,
Defendant-Appellant.
__________________________________
Submitted December 19, 2018 – Decided January 15, 2019
Before Judges Alvarez and Reisner.
On appeal from Superior Court of New Jersey, Law
Division, Passaic County, Docket No. L-3734-15.
Sellar Richardson, PC, attorneys for appellant (Denise
M. Luckenbach, on the brief).
Respondents have not filed briefs.
PER CURIAM
Western Surety Company (Western) appeals from a September 8, 2017
order denying Western's motion to vacate the dismissal of Western's answer and
cross-claim against co-defendants Long Island Auto Find, Inc. (LIAF), and
Brian Keegan. After reviewing the record, we conclude that the September 8,
2017 order was entered based on a misunderstanding of the motion record, and
hence, constituted a mistaken exercise of discretion. Accordingly, we reverse
the order and remand with direction to vacate the dismissal and reinstate the
answer and cross-claim.
A brief explanation will suffice here. Western stood as a surety to LIAF
and its president, Brian Keegan, who were defendants in a consumer fraud action
filed by Agnieszka Dela and Maria Dela. The Delas' complaint also named
Western as a defendant, and Western in turn filed a cross-claim against LIAF
and Keegan. Eventually, Western paid the Delas to settle their lawsuit against
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LIAF and Keegan. LIAFF and Keegan defaulted on Western's cross-claim. The
case was scheduled for a trial call on February 27, 2017. When Western's
attorney failed to appear for the trial call, its answer and cross-claim were
dismissed. See R. 1:2-4(a) (authorizing the court to impose sanctions, including
dismissal, for failure to appear at a trial call).
Western filed a motion to vacate the dismissal and restore its answer and
cross-claim. According to a certification filed by Western's attorney, after
Western settled with the Delas "the entire case was inadvertently marked settled
in the attorney's diary resulting in a failure to recognize the need for an
appearance at the trial call on February 27, 2017." The attorney explained that
she did not even realize that Western's case had been dismissed until she
received a May 10, 2017 order denying her motion to enter default judgement
against LIAF and Keegan. The May 10 order noted that the motion was denied
because Western's pleadings had been dismissed due to failure to appear at the
trial call.
The reinstatement motion did not seek reconsideration of the May 10,
2017 order. It only sought reinstatement of the stricken answer and cross-claim,
for reasons the attorney explained. In an apparent misunderstanding, the trial
court denied the reinstatement motion, characterizing it as an untimely motion
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for reconsideration of the May 10 order and noting: "Please explain why this
movant failed to appear at the Feb. 27, 2017 trial date."
We review the trial court's order for abuse of discretion. See Gonzales v.
Safe & Sound Sec. Corp., 185 N.J. 100, 115 (2005). However, we cannot defer
to a decision that is not supported by the record or otherwise rests "on an
impermissible basis." U.S. Bank Nat’l Ass’n v. Guillaume, 209 N.J. 449, 467
(2012) (citation omitted).
In this case, we conclude that the order was a mistaken exercise of
discretion, because it was based on a mistaken understanding of the motion
record. The attorney explained her inadvertent failure to appear at the trial call
– a mistake that, in the interests of justice, should not be visited on her client.
The drastic remedy of dismissal with prejudice as a sanction is disfavored and
should be invoked sparingly. See Connors v. Sexton Studios, Inc., 270 N.J.
Super. 390, 395 (App. Div. 1994). Where a party has no viable defense to a
claim for indemnification, it does not serve the interests of justice to give that
party a windfall by denying the claim on procedural grounds, particularly in the
absence of prejudice. See Kent Motor Cars, Inc. v. Reynolds & Reynolds, Co.,
207 N.J. 428, 452 (2011).
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Accordingly, we reverse the order on appeal and remand for entry of an
order granting the motion and reinstating Western's answer and cross -claim.
Once the cross-claim is reinstated, Western may re-file its motion for default
judgment against LIAF and Keegan, on notice to those parties.
Reversed and remanded. We do not retain jurisdiction.
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