In a world filled with partnerships, subsidiaries, and joint ownerships, identifying a defendant is not as easy as it sounds. However, if a plaintiff fails to name the correct defendant, he may risk dismissal. The question becomes what does a plaintiff need to do to ensure that his claim is not dismissed? Is it reasonable to rely on a party’s representation that they are the defendant? What will be the result if a party deceives another into believing they are defendant, when they are not?
In Dashi Slatina & Vjollca Slatina v. D. Construction Corp. and Armored Inc., A-0851-10T2 (N. J. Super. Ct., App. Div. August 3, 2012), the plaintiff, Dashi Slatina, suffered serious injuries at work. He was erecting a masonry wall when it toppled on him. He filed suit against Newport Associate Development Company (“Newport”) under the belief that Newport was the owner and/or general contractor. However, the trial court dismissed the complaint with prejudice against the plaintiff because Newport was not the actual owner and/or general contractor.
Thereafter, the plaintiff filed a motion to amend the complaint in order to include the actual owner and general contractor. The basis for the motion was that plaintiff had been misled into believing that it had named the correct defendant. For example,
- Newport initially admitted it owned the property where the plaintiff was injured.
- Newport’s interrogatory answers and it’s counsel’s certification did not expressly deny ownership, nor did it identify the actual owner and or general contractor (which Newport was actually linked to by common ownership).
- The insurance policies that named the actual owner also included Newport as a named insured after the accident occurred.
The trial court denied plaintiff’s motion. In its holding, the court explained “that absent a pre-existing complaint, a plaintiff has nothing to amend”. Therefore, the very idea of amending a complaint that had just been dismissed was illogical. In its holding, the trial court mentioned that the only way to restore (and essentially amend) the complaint would be upon reconsideration, or if judgment were vacated after an appeal.
On appeal, the Superior Court considered whether the trial court abused its discretion when it denied the motion for leave to amend. In reversing the trial court’s decision and holding for the plaintiff, the Superior Court explained that although the trial court applied the correct standard for determining reconsideration, it did not construe the standard as liberally as the circumstances warranted. Rule 4:50-1 states,
On motion, with briefs, and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for the following reasons:
(a) mistake, inadvertence, surprise, or excusable neglect;
(b) newly discovered evidence which would probably alter the judgment or order and which by due diligence could not have been discovered in time to move for a new trial under R. 4:49;
(c) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (d) the judgment or order is void;
(e) the judgment or order has been satisfied, released or discharged, or a prior judgment or order upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment or order should have prospective application; or
(f) any other reason justifying relief from the operation of the judgment or order.
The Superior Court held that although the circumstances of this case do not fall into subsection (a) through (e) of Rule 4:50 -1, the trial court had the authority to grant plaintiff’s leave to amend under the catchall, subsection (f). That subsection allowed the trial court to consider whether it was “in the interest of justice” to restore the complaint for the purpose of enabling the plaintiff to add additional parties. Thus the Court explained that under subsection (f), the trial court had sufficient discretion to grant relief to address exceptional circumstances.
The Court found exceptional circumstances to be present in that case because the great injustice it would create if it held otherwise. The Court explained that Newport initially admitted to owning the property and throughout its interrogatories never expressly stated that they did not. In fact, Newport was not only named as an insured on the post-accident insurance policy, but they also turned out to be a related entity to the “true owners.”
The Court also recognized that the policy was one promoting decisions on the merits. To hold otherwise would result in the “true owners” being able to avoid responding to the merits of the lawsuit. This would be due to the delayed disclosure by Newport, a related entity. The Court also took into consideration the fact that Newport would suffer no prejudice because the complaint would be restored solely for the purpose of allowing the new amendment and would not subject Newport to potential liability. Finally, the Court noted that plaintiff acted promptly to restore the complaint after judgment was entered. All of these factors favored allowing plaintiff to restore it to the active docket.
The lesson of this case is that a party should always thoroughly investigate whether or not it is bringing suit against the correct party. Nevertheless, in the event that the wrong party is named, under the right circumstances, there may be a remedy.
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