MARIA VICTORIA COLE v. DARIUSZ WINNICKI, ESQ

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

MARIA VICTORIA COLE,

Plaintiff-Respondent,

v.

DARIUSZ WINNICKI, ESQ. and

HARTMAN & WINNICKI, P.C.,

Defendants-Appellants.

______________________________

May 8, 2014

Argued April 8, 2014 Decided

Before Judges Fisher and Koblitz.

On appeal from Superior Court of New Jersey, Law Division, Passaic County, Docket No. L-1449-11.

Steven M. Cytryn argued the cause for appellants (Hartman & Winnicki, P.C., attorneys; Warren S. Robins and Mr. Cytryn, on the briefs).

Carleen M. Steward argued the cause for respondent Maria Victoria Cole (Fruhschein & Steward, L.L.C., attorneys; Ms. Steward, on the brief).

Alberico De Pierro argued the cause for respondent Ambrosio, De Pierro & Wernick, L.L.C. (De Pierro Radding, L.L.C., attorneys; Mr. De Pierro, on the brief).

PER CURIAM

Defendants Dariusz Winnicki, Esq. and Hartman & Winnicki, P.C. appeal from the May 10, 2013 order denying their application for frivolous litigation sanctions against plaintiff Maria Victoria Cole and her counsel, Ambrosio, De Pierro & Wernick, LLC1 (Ambrosio Law Firm), after plaintiff's malpractice action was dismissed on summary judgment. We affirm.

Although the present appeal deals only with the trial court's denial of defendants' motion to impose sanctions on the Ambrosio Law Firm and plaintiff, the following background is helpful to put this appeal in context. On November 3, 2003, testator Francesco Racamato died leaving his six children as heirs. Plaintiff is one of Racamato's children. One of Racamato's other children, Domenica C. Racamato Pignatello, was appointed executrix of the estate. The executrix retained defendants, her parents' former counsel, to provide legal services for the estate.

On or about April 29, 2004, plaintiff's then counsel, William J. Maione, Esq., contacted defendants, inquiring about the status of the estate. On August 2, 2004, defendants sent a letter to Maione, enclosing documents relating to the probate of the estate, including an informal accounting. Plaintiff received the documents in 2004.

Four years later, on December 4, 2008, plaintiff filed a complaint and order to show cause to compel a formal accounting and to have herself appointed as administratrix of the estate. This action was dismissed on December 1, 2009, with prejudice. When dismissing the action, the judge stated that plaintiff was just expressing her estrangement from her siblings.

We reversed the dismissal of the action and remanded the matter so that a formal accounting of the estate could be prepared. On remand, defendants ceased representing the estate, and the executrix obtained new counsel. When granting the request for a formal accounting after our remand, the judge2 stated:

[U]nfortunately this is an antagonism between the sisters, a complete antagonism. The five there's two people involved right now, the executrix and [plaintiff]. There's four other sisters who are beneficiaries who actually have suffered terribly by this action, suffered. What [plaintiff] did did not benefit anyone, did not benefit anyone.

The judge noted that plaintiff had spent $40,000 between expenses and counsel fees to litigate a $75,000 inheritance.

Plaintiff, through the Ambrosio Law Firm, filed a malpractice action against defendants seeking damages in connection with defendants' handling of the administration of the estate. Three weeks later, defendants served a notice of frivolous action letter pursuant to Rule 1:4-8 demanding the malpractice action be withdrawn. Defendants' April 15, 2011 letter also informed plaintiff that one defendant left Hartman & Winnicki, P.C. in 2001, more than two years before the death of Racamato, and another defendant joined the firm in 2008, over four years after the Racamato Estate had been probated. Plaintiff dismissed the malpractice action as to those two attorneys. Defendants claimed in their letter that, pursuant to Estate of Albanese v. Lolio, 393 N.J. Super. 355 (App. Div.), certif. denied, 192 N.J. 597 (2007), no fiduciary relationship existed between defendants and plaintiff because plaintiff never relied upon them.

Plaintiff continued to pursue the malpractice action against the remaining defendants until the judge granted defendants' motion for summary judgment prior to the completion of discovery. Defendants then filed a motion to impose sanctions against the Ambrosio Law Firm pursuant to Rule 1:4-8 and against plaintiff pursuant to the Frivolous Litigation Statute, N.J.S.A. 2A:15-59.1.

In Estate of Albanese, we held that where an attorney gave poor tax advice to the executrix of an estate, summary judgment was appropriate against the beneficiaries of the estate in part because they had not "charged [the executrix] with a breach of fiduciary duty, commenced any type of action against her, or contested any accounting." 393 N.J. Super. at 376. A new judge denied defendants' motion seeking frivolous litigation sanctions, stating that defendants' reading of Albanese was too expansive and that:

the determination of whether a duty can exist was found to be "necessarily fact-dependent". [Estate of Fitzgerald v. Linnus, 336 N.J. Super. 458, 473 (App. Div. 2001)]. This Court is satisfied that, although, plaintiff's claims were ultimately found to be insufficient to withstand summary judgment, that fact does not ipso facto mean that they were baseless.

On appeal, defendants argue that the motion judge failed to consider the fact that plaintiff, who had her own attorney, did not rely on defendants. Defendants also contend that the Ambrosio Law Firm failed to submit any "evidentiary support" for such reliance.

"An assertion is deemed frivolous when 'no rational argument can be advanced in its support, or it is not supported by any credible evidence, or it is completely untenable.'" First Atl. Fed. Credit Union v. Perez, 391 N.J. Super. 419, 432 (App. Div. 2007) (quoting Fagas v. Scott, 251 N.J. Super. 169, 190 (Law Div. 1991)). "'That some of the allegations made at the outset of litigation later proved to be unfounded does not render frivolous a complaint that also contains some non-frivolous claims.'" Iannone v. McHale, 245 N.J. Super. 17, 32 (App. Div. 1990) (quoting Romero v. City of Pomona, 883 F.2d 1418, 1429 (9th Cir. 1989)). Where a party has reasonable and good faith belief in the merit of the cause, attorney's fees will not be awarded. DeBrango v. Summit Bancorp, 328 N.J. Super. 219, 227 (App. Div. 2000). The nature of conduct warranting sanction under Rule 1:4-8 has been strictly construed, Wyche v. Unsatisfied Claim & Judgment Fund, 383 N.J. Super. 554, 560 (App. Div. 2006), and "the term 'frivolous' should be given a restrictive interpretation" to avoid limiting access to the court system. McKeown-Brand v. Trump Castle Hotel & Casino, 132 N.J. 546, 561-62 (1993).

Pursuing the formal accounting was reasonable as evidenced by our prior opinion. Estate attorneys who wrongfully drive up litigation costs may be held liable to the beneficiaries of the estate. See Rothblott v. Levin, 697 F. Supp. 817, 820 (D.N.J. 1988) (applying New Jersey law). Defendants charged the estate approximately $100,000 for unsuccessfully litigating the formal accounting issue. There was therefore some proof defendants did not handle the matter properly, harming plaintiff and giving the Ambrosio Law Firm a rational basis to believe defendants committed malpractice in their administration of the estate.

"[I]n limited circumstances, 'attorneys may owe a duty of care to non-clients when the attorneys know, or should know, that non-clients will rely on the attorneys' representations and the non-clients are not too remote from the attorneys to be entitled to protection.'" Innes v. Marzano-Lesnevich, __ N.J. Super. __, __ (App. Div. 2014) (slip op. at 13) (quoting Petrillo v. Bachenberg, 139 N.J. 472, 483-84 (1995)). The determination of whether a duty exists between an attorney and a non-client is "necessarily fact-dependent." Fitzgerald, supra, 336 N.J. Super. at 473. The attorney representing the executrix has a duty to conserve the assets of the estate for the heirs.

Defendants also contend that the trial court erred when it found that plaintiff's claim was not frivolous pursuant to the Frivolous Litigation Statute. They argue the trial court erred by not considering the element of bad faith or, at a minimum, by not ordering a hearing to determine if plaintiff acted in bad faith. A trial court's determination on the availability and amount of fees and costs for frivolous litigation is reviewed under an abuse of discretion standard. Masone v. Levine, 382 N.J. Super. 181, 193 (App. Div. 2005).

The Frivolous Litigation Statute permits a court to award reasonable counsel fees and litigation costs to a prevailing party in a civil action if the court determines "that a complaint . . . of the non-prevailing person was frivolous." Toll Bros., Inc. v. Twp. of West Windsor, 190 N.J. 61, 67 (2007) (quoting N.J.S.A. 2A:15-59.1(a)(1)). A claim constitutes frivolous litigation if upon "'judging the [claimant's] conduct as a whole,' the claim 'was brought in bad faith or for the purpose of delay and harassment.'" In re La Tourette, 156 N.J. 444, 448 (1998) (alteration in original) (quoting Deutch & Shur, P.C. v. Roth, 284 N.J. Super. 133, 139 (Law Div. 1995)). A party can "rely on the advice of counsel and still act in bad faith solely to harass, delay, or maliciously injure." McKeown-Brand, supra, 132 N.J. at 559.

The bad faith that would have to be proven here, however, is not plaintiff's animosity toward her siblings, but rather her animosity toward defendants, counsel for the executrix. No evidence existed of such animosity, and the likelihood of demonstrating that a lay litigant is acting in bad faith when she follows the advice of counsel is extremely slim. See Ferolito v. Park Hill Ass'n, 408 N.J. Super. 401, 408 (App. Div.) (Because clients generally rely on the advice of counsel, when a litigant alleged to have engaged in frivolous litigation is represented by counsel, the moving party bears the burden of proving bad faith on the part of the adversarial litigant.), certif. denied, 200 N.J. 502 (2009).

Affirmed.

1 Dissolved as of September 1, 2012.

2 A different judge presided over the matter on remand than had initially denied an accounting.