NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NOS. A-1406-16T1
A-1457-16T1
WILLIAM F. BRUNT, JR.,
Plaintiff-Respondent,
v. APPROVED FOR PUBLICATION
BOARD OF TRUSTEES, POLICE & June 18, 2018
FIREMEN'S RETIREMENT SYSTEM
IN THE DIVISION OF PENSIONS & APPELLATE DIVISION
BENEFITS, STATE OF NEW JERSEY;
HANK SCHWEDES; CHERYL CHIANESE
and BERNARDINE BROZENA,
Defendants-Respondents,
and
THE TOWNSHIP OF MIDDLETOWN IN
THE COUNTY OF MONMOUTH; and
HELEN ALFANO,
Defendants-Appellants.
_______________________________
WILLIAM F. BRUNT, JR.,
Plaintiff-Respondent,
v.
BOARD OF TRUSTEES, POLICE &
FIREMEN'S RETIREMENT SYSTEM
IN THE DIVISION OF PENSIONS &
BENEFITS, STATE OF NEW JERSEY;
HANK SCHWEDES; CHERYL CHIANESE
and BERNARDINE BROZENA,
Defendants-Appellants,
and
THE TOWNSHIP OF MIDDLETOWN IN
THE COUNTY OF MONMOUTH; and
HELEN ALFANO,
Defendants-Respondents.
________________________________
Argued April 9, 2018
Before Judges Ostrer and Rose.
Reargued telephonically May 31, 20181 –
Decided June 18, 2018
Before Judges Sabatino, Ostrer and Rose.
On appeal from Superior Court of New Jersey,
Law Division, Monmouth County, Docket No.
L-1573-16.
Michael L. Collins argued the cause for
Township of Middletown and Helen Alfano,
appellants in A-1406-16 and respondents in
A-1457-16 (Archer & Greiner, PC, attorneys;
Brian M. Nelson, of counsel; Kira S. Dabby
and Michael L. Collins, on the brief).
Jeffrey S. Ignatowitz, Deputy Attorney
General, argued the cause for Board of
Trustees, Police and Firemen's Retirement
System, appellant in 1457-16 and respondent
in A-1406-16 (Gurbir S. Grewal, Attorney
General, attorney; Daniel F. Thornton,
Deputy Attorney General, on the brief).
Larry S. Loigman argued the cause for
respondent William F. Brunt., Jr.
1
The appeal was re-argued at the court's request to add Judge
Sabatino.
2 A-1406-16T1
The opinion of the court was delivered by
ROSE, J.S.C. (temporarily assigned).
The issue in these back-to-back appeals, which we
consolidate for purposes of this opinion, is whether the trial
court erred in granting counsel fees to plaintiff, William F.
Brunt, Jr., who prevailed in a Law Division action to enforce an
agency decision. Because we adhere to the so-called American
Rule, requiring litigants to bear their own litigation costs
regardless of who prevails, we reverse.
We summarize the facts and procedural history most
pertinent to this appeal. In June 2014, plaintiff retired from
the Township of Middletown ("Middletown") Police Department
while serving as interim deputy chief. When plaintiff's pension
calculation failed to include his increased deputy chief salary,
plaintiff successfully challenged the error before an
administrative law judge ("ALJ"). Middletown was not aware of
the hearing and, as such, did not participate. The Board of
Trustees of the Police and Firemen's Retirement System ("Board")
subsequently adopted the ALJ's decision.
However, by correspondence dated May 2, 2016, Cheryl
Chianese, the Board's Retirement and Beneficiary Services Bureau
Chief, advised plaintiff's counsel that additional adjustments
to plaintiff's final salary required an updated certification
3 A-1406-16T1
from Middletown, so that the Board could process his
recalculated pension benefits. Chianese's letter stated, in
pertinent part:
As I previously advised in 2014, your
concerns should have been addressed directly
to Middletown Township before filing an
appeal with the Board of Trustees. We
cannot comment on behalf of [plaintiff's]
employer and can only calculate a benefit
based on the salary that is remitted to the
Division of Pensions and Benefits
[("Division")] by the employer.
A review of [plaintiff's] membership
file has revealed there have not been
additional pension contributions, or salary
reported to the Division as of today's date.
If you have knowledge that the employer will
be remitting retroactive salary information,
we will be happy to recalculate the benefit.
Two days later, plaintiff filed an order to show cause and
complaint in lieu of prerogative writs in the Law Division,
naming as defendants the Board and its agents or employees, Hank
Schwedes, Bernardine Brozena, and Chianese ("State Defendants"),
and Middletown and its payroll supervisor, Helen Alfano
("Middletown Defendants"). In essence, plaintiff sought
enforcement of the Board's adoption of the ALJ's initial
decision granting plaintiff's recalculated pension.
Joined by the Middletown Defendants, the State Defendants
moved to dismiss the complaint. Following oral argument on July
20, 2016, the court denied the motion, and granted plaintiff's
4 A-1406-16T1
order to show cause seeking enforcement of the agency decision.
In doing so, the court ordered defendants to include plaintiff's
final paycheck in its recalculation, and provide plaintiff with
an accounting of the recalculation of his benefits within
fifteen days of completion.2 The motion judge also reserved
decision regarding plaintiff's application for counsel fees,
permitting the parties to brief the issue of whether fees were
"awardable in the instant situation."3
On August 8, 2016, Chianese advised plaintiff of the
Board's recalculation of his pension benefits. On August 31,
2016, the trial court entered an order awarding counsel fees to
plaintiff in the amount of $4,492.
2
After plaintiff filed his complaint, and Middletown thus became
aware of his claim, Middletown submitted four certifications to
the Board, reflecting in its pension calculation plaintiff's
position as interim chief. The certifications were revised to
correct errors, including pension deductions. See N.J.A.C.
17:2-6.1(e) ("Before an application for retirement may be
processed, the Division must receive . . . a completed
Certification of Service and Final Salary form from the employer
setting forth the employment termination date, and the salaries
reported for contributions in the member's final year of
employment.")
3
According to his merits brief, "Plaintiff did not seek counsel
fees in the underlying controversy, which required appearances
before the . . . Board . . . and an appeal to the Office of
Administrative Law . . . . Plaintiff believed that his salary
in an interim position was pensionable, consistent with the
governing regulations, but it may have been a good faith dispute
that led [the Board] and [Middletown] to arrive at a different
conclusion."
5 A-1406-16T1
In his written statement of reasons, the motion judge cited
plaintiff's unsuccessful "two-year pursuit to correct the
miscalculation of its retirement award[,]" and determined
defendants were uncooperative in recalculating plaintiff's
pension award until he filed the present action. Although the
judge acknowledged the limitations of the American Rule, he
quoted the Court's decision in Masse v. Public Employees
Retirement System, 87 N.J. 252, 259-61 (1981), "liberally
constru[ing]" statutory pension provisions in favor of public
employees. The motion judge concluded "justice would not be
served" if plaintiff were to bear the counsel fees.
Specifically, he said, "A determination to the contrary would
have the effect of discouraging any litigation over the
calculation of retirement benefits."
Following oral argument on November 18, 2016, the judge
denied the Middletown Defendants' motion for reconsideration.
In doing so, he referenced Justice Albin's dissenting opinion in
In the Matter of the Estate of Folcher, 224 N.J. 496, 519-20
(2016), to support his own finding that "it would be inequitable
for plaintiff who had served the municipality with distinction
for decades [to] be burdened with additional legal fees by the
need to bring this action."
6 A-1406-16T1
Defendants appeal the award of counsel fees, arguing there
is no legal basis for the award. Based on the record before us,
we agree.
Our review of a trial court's order on a motion for
reconsideration is limited, but it will be set aside if its
entry is based on a mistaken exercise of discretion. See
Granata v. Broderick, 446 N.J. Super. 449, 468 (App. Div. 2016)
(citing Fusco v. Bd. of Educ. of City of Newark, 349 N.J. Super.
455, 462 (App. Div. 2002)). A court abuses its discretion "when
a decision is 'made without a rational explanation, inexplicably
departed from established policies, or rested on an
impermissible basis.'" Pitney Bowes Bank, Inc. v. ABC Caging
Fulfillment, 440 N.J. Super. 378, 382 (App. Div. 2015) (quoting
Flagg v. Essex Cty. Prosecutor, 171 N.J. 561, 571 (2002)).
Thus, reconsideration should be granted, for example, in those
cases in which the court had based its decision "upon a palpably
incorrect . . . basis." Fusco, 349 N.J. Super. at 462 (quoting
D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. Div. 1990)).
Despite the significant discretion trial courts have in
awarding recoverable attorneys' fees, "such determinations are
not entitled to any special deference if the judge 'misconceives
the applicable law, or misapplies it to the factual complex.'"
Porreca v. City of Millville, 419 N.J. Super. 212, 224 (App.
7 A-1406-16T1
Div. 2011) (quoting Kavanaugh v. Quigley, 63 N.J. Super. 153,
158 (App. Div. 1960)).
Further, "we need not defer to a trial court's
interpretation of the law." In re Estate of F.W. v. State of
N.J., Div. of Youth and Family Servs., 398 N.J. Super. 344, 355
(App. Div. 2008) (citing Manalapan Realty, LP v. Twp. Comm. of
Manalapan, 140 N.J. 366, 378 (1995)). Thus, we undertake a de
novo review when analyzing questions of law raised in an
application to approve a fee request.
Having long-adhered to the American Rule, New Jersey
generally disfavors the shifting of fees where they are not
expressly authorized. See, e.g., Innes v. Marzano-Lesnevich,
224 N.J. 584, 592 (2016) (citing Litton Indus., Inc. v. IMO
Indus., Inc., 200 N.J. 372, 404 (2009)); N. Bergen Rex Transp.,
Inc. v. Trailer Leasing Co., 158 N.J. 561, 569 (1999). As noted
by our Supreme Court, "The purposes behind the American Rule are
threefold: (1) unrestricted access to the courts for all
persons; (2) ensuring equity by not penalizing persons for
exercising their right to litigate a dispute, even if they
should lose; and (3) administrative convenience." Innes, 224
N.J. at 592 (quoting In re Niles Trust, 176 N.J. 282, 294
(2003)). Rather, counsel fees are recoverable "if they are
expressly provided for by statute, court rule, or contract."
8 A-1406-16T1
Packard-Bamberger & Co., Inc. v. Collier, 167 N.J. 427, 440
(2001); see also R. 4:42-9 ("No fee for legal services shall be
allowed" except for the eight actions expressly stated in the
Rule.).
Here, the award of counsel fees for plaintiff's success on
his prerogative writs action was not appropriate pursuant to any
statutory provision, or subsection of Rule 4:42-9. Instead, the
motion judge relied on equitable principles, including those
espoused by Justice Albin in his dissenting opinion in Folcher.
There, the decedent's wife engaged in fraud and forgery,
impacting other beneficiaries of her deceased husband's estate.
Folcher, 224 N.J. at 505. Under such circumstances, Justice
Albin posited that the decedent's wife should have been liable
for attorneys' fees to the prevailing parties for her "egregious
misconduct." Id. at 521. The Court's majority, however, found
the wife's confidential relationship with her husband did not
create a fiduciary relationship between the wife and her
husband's remaining beneficiaries. Id. at 513; see In re Niles
Trust, 176 N.J. at 299 (creating an exception for attorneys'
fees "limited to cases in which an executor's or a trustee's
undue influence results in the development or modification of
estate documents that create or expand the fiduciary's
beneficial interest in the estate").
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No such fiduciary relationship or fraud is alleged in the
present case. Even assuming defendants were uncooperative in
their efforts to effectuate the ALJ's decision, plaintiff did
not allege fraud in their handling of his pension claim.
Moreover, unlike discrete statutes permitting an award of
counsel fees to successful litigants in certain administrative
matters, the Legislature has not delegated such authority in
pension cases. Compare N.J.S.A. 34:19-5 (allowing counsel fees
under the Conscientious Employee Protection Act, N.J.S.A. 34:19-
1 to -8, from an "employer," defined as including
"municipalities" and "agenc[ies]"; N.J.S.A. 34:11B-12
(permitting fees from an "employer," defined as "the State, any
political subdivision thereof, and all public offices, agencies,
boards or bodies," pursuant to the Family Leave Act, N.J.S.A.
34:11B-1 to -16); N.J.S.A. 10:5-27.1 (permitting the recovery of
"a reasonable attorney's fee as part of the cost" against an
offending employer, including municipalities, under the Law
Against Discrimination, N.J.S.A. 10:5-1 to -42); see also
Balsley v. N. Hunterdon Reg'l Sch. Dist. Bd. of Educ., 117 N.J.
434, 443, 446-47 (1990) (holding the Commissioner of Education
lacked express statutory authority to award counsel fees to a
prevailing party in an education-discrimination matter).
10 A-1406-16T1
We are not persuaded, therefore, that the trial court's
liberal construction of statutory pension provisions applies to
the award of counsel fees here. The judge's reliance on Masse
in this regard is misplaced because that case did not address a
fee-shifting statute.
Because we find no legal basis for the award of counsel
fees, we are constrained to reverse the motion judge's orders
awarding fees and denying the Middletown Defendants' motion for
reconsideration. In light of our decision, we need not reach
defendants' remaining claims.
Reversed.
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