Opinion
DOCKET NO. A-4573-11T2
05-06-2013
RALPH CIOFFI, Plaintiff-Appellant, v. COUNTY OF HUDSON, Defendant-Respondent, and STATE OF NEW JERSEY, Defendant.
Robert E. Margulies argued the cause for appellant (Margulies, Wind, PC, attorneys; Mr. Margulies, Jack Jay Wind and Gerard Pizzillo, on the briefs). Michael L. Dermody, First Assistant County Counsel, argued the cause for respondent (Donato J. Battista, Hudson County Counsel, attorney; Mr. Dermody, on the brief).
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
Before Judges Lihotz and Ostrer.
On appeal from the Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-2396-01.
Robert E. Margulies argued the cause for appellant (Margulies, Wind, PC, attorneys; Mr. Margulies, Jack Jay Wind and Gerard Pizzillo, on the briefs).
Michael L. Dermody, First Assistant County Counsel, argued the cause for respondent (Donato J. Battista, Hudson County Counsel, attorney; Mr. Dermody, on the brief). PER CURIAM
Plaintiff, Ralph Cioffi appeals from a Law Division order denying his motion to enforce the terms of a May 2003 agreement with defendant Hudson County, settling his claimed civil rights violations. The motion judge found plaintiff's enforcement request was barred by the statute of limitations, and, otherwise, he had failed to prove defendant's breach. We affirm in part and remand in part.
Plaintiff was employed as a Lieutenant in the now defunct Hudson County Police Department. In April 1995, he was removed from his position. However, following an administrative hearing, the charges upon which his termination was grounded were dismissed, and plaintiff's reinstatement was ordered. Thereafter, plaintiff initiated an action in the Law Division, alleging "he was targeted with unwarranted disciplinary charges and subjected to the constant threat of termination as a result of his unwillingness to participate in certain illegal activities which ultimately led to the Hudson County Police Department being disbanded" (the civil rights action).
The statement is taken from plaintiff's brief as the complaint is not included in the record.
In January 2003, on the eve of trial of the civil rights action, the parties resolved their differences and placed the terms of settlement on the record. A written agreement was executed on or about May 30, 2003. The agreement settled not only the claims raised in civil rights action, but also issues presented in two pending administrative law matters (settlement agreement).
The terms of settlement were very detailed and the settlement agreement provided for their immediate implementation. Without repeating each provision, we note plaintiff's employment was conditionally reinstated and defendant agreed to pay compensatory damages. Further, relevant to plaintiff's motion to enforce now under review, were the following provisions regarding defendant's obligations to fund plaintiff's pension:
2D. The County will be responsible for all employer and employee pension payments based on the base salaries for a Sergeant for the years 1996 to 2003 as set forth [in a chart] below and plaintiff shall be responsible for the pension payments to raise the pension to the Lieutenant level based on base salaries as set forth below:Plaintiff also agreed he would end his employment and consented to refrain from future employment with defendant. Also, defendant agreed to execute necessary documents to permit plaintiff to transfer to the City of Jersey City Police Department.
. . . .
2E. The effect of paragraph 2 in the agreement would be to have the County, fund the Police and Fire Retirement System [(PFRS)] Pension for [plaintiff] for service in pension in full to 1/16/03 without a break in service. For the time subsequent to January 16, 2003, [plaintiff] waives any additional County contribution and [plaintiff], from his other funds, will be permitted to contribute to the pension to the date of the execution of this agreement[.]
Defendant paid the compensatory damages required under the settlement agreement. Plaintiff signed a voucher accompanying the check, verifying payment was made to resolve the civil rights action pursuant to the terms of the settlement agreement. Thereafter, on September 11, 2003, defendant sent notice it intended to remit a second check to PFRS in the amount of $77,940.77, "with respect to the funding of the pension." The letter was accompanied by a voucher form identical to the one previously executed by plaintiff, except its stated purpose was: "In compliance with a Settlement Agreement of the matter captioned Ralph Cioffi v. County of Hudson bearing Docket No.: HUD-L-2020-98, wherein it was agreed that the County would fund a portion of Mr. Cioffi's pension in accordance with the terms of the Settlement Agreement." A subsequent letter from county counsel informed plaintiff his estimated pension contribution for 2002-2003, was $10,972.90.
The amount cannot be reconciled with the other information provided in counsel's correspondence.
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Plaintiff questioned defendant's calculations and sought verification of the calculations of the proposed $77,940.77 payment and the $10,972.90 claimed as his required contribution. The record does not include defendant's reply, but a December 15, 2003 letter from county counsel confirmed a conversation with plaintiff's counsel suggesting defendant's understanding plaintiff was delaying the voucher's execution "until matters [we]re [w]rapped up with the personnel part of the case[,]" referring to the administrative law matters.
Defendant sent several follow-up letters to plaintiff's attorney addressing the need for the voucher before the $77,940.77 could be remitted to PFRS, and explaining the $10,972.90 was merely an estimated amount, payable only if plaintiff desired to increase his pension interest to that given to a Lieutenant. Letters on January 2, 2004 and December 15, 2005, reflect an on-going dialogue between the parties' legal counsel regarding plaintiff's objection to the calculation of the amount proposed to be remitted to PFRS, and defendant's assertion it relied on PFRS's calculations of the amounts and insistence plaintiff return the voucher.
On August 10, 2006, plaintiff's attorney wrote to county counsel renewing efforts to resolve the pension funding issue. He claimed plaintiff had been prevented from collecting his pension because defendant had not provided funding as agreed, and asserted a claim for additional damages. Counsel further noted plaintiff was due compensation because the April 1995 to September 1996 suspension was reversed; was due the sum of $625 as originally required by the terms of settlement, and demanded counsel fees. Defendant replied, rejecting any notion it was at fault for the delay in remitting monies to PFRS, and attached copies of past correspondence relating the need for plaintiff to return the authorizing voucher.
By September 2006, it appeared things were reaching a resolution. Defendant provided proof it supplied the necessary payment to PFRS for the period of plaintiff's wrongful suspension, and explained any error in the calculated amount would be corrected by the State, which would bill defendant for additional sums due. Defendant also recognized its obligation to pay $625 under the settlement agreement and admitted it had overstated plaintiff's obligation to purchase the pension differential. It was agreed plaintiff would return the voucher reflecting the payment of $77,787.01, without prejudice to the accuracy of defendant's contribution. Plaintiff also asserted he was not waiving any claims resulting from the delay in funding. Before month's end, defendant issued payment to PFRS for the outstanding pension contributions. On October 6, 2006, plaintiff delivered his pension application to defendant for verification and filing with PFRS.
Problems again surfaced, delaying release of pension payments to plaintiff. On October 26, 2006, the State returned the $77,787.01 check, requesting two checks be issued separating the employer's and employee's respective contributions. Next, PFRS advised it intended to calculate plaintiff's pension based on his last reported salary, which deviated from the parties' agreement. PFRS took the position only plaintiff could request different calculations be made in accordance with the settlement agreement, by appealing the decision on the applicable salary. Plaintiff declined to do so. The record does not state how this issue was ultimately resolved.
Defendant resent plaintiff's pension application to PFRS in January 2007, which was received on January 25, 2007. Although plaintiff's request included a retirement date of January 1, 2003, PFRS advised the earliest permissible retirement date was February 1, 2007, the beginning of the month following the application's receipt. It was later learned that PFRS determined defendant's calculation overstated the employer and employee pension contributions, and had reset the amounts due.
On February 3, 2012, plaintiff filed a motion, using the civil rights action's docket number, to enforce terms of the settlement agreement. He alleged defendant violated the settlement agreement by refusing to immediately fund his pension and wrongfully delaying funding by insisting he execute a voucher. He sought relief in the form of the alleged loss of benefits from 2003 to 2007, along with cost of living increases. Plaintiff also requested monies alleged to be due under the administrative actions and the $625 set forth in the settlement agreement. Defendant opposed the motion, attaching all prior correspondence showing its compliance and attributing any delay to plaintiff's refusal to remit the voucher authorizing the issuance of the check.
On April 3, 2012, the motion judge rendered an oral opinion based on the papers submitted. The judge found plaintiff knew of the alleged breach in 2003, when defendant insisted on receipt of the voucher prior to remitting the requisite receipt to PFRS. He concluded the six-year statute of limitations for breach of contract claims applied, therefore, plaintiff's action should have been initiated in 2009. The judge rejected plaintiff's argument to toll any limitations period or apply laches, concluding no factual support for these remedies was presented. Finally, the court found defendant had not breached its obligations under the settlement agreement, concluding the request for an executed voucher "was merely complying with the State requirements for initiating pension benefits." An order memorializing the decision was entered from which plaintiff appeals.
We consider principles governing settlement agreements. "'Generally, a settlement agreement is governed by principles of contract law.'" Brundage v. Estate of Carambio, 195 N.J. 575, 600-01 (2008) (quoting Thompson v. City of Atl. City, 190 N.J. 359, 379 (2007)). We review the "[i]nterpretation and construction of a contract" de novo. Kaur v. Assured Lending Corp., 405 N.J. Super. 468, 474 (App. Div. 2009) (internal quotation marks and citations omitted).
"A settlement agreement between parties to a lawsuit is a contract." Nolan v. Lee Ho, 120 N.J. 465, 472 (1990) (citation omitted). Under N.J.S.A. 2A:14-1, the statute of limitations for a breach of contract claim "commence[s] within 6 years next after the cause of any such action shall have accrued." The statute of limitations begins when "the party seeking to bring the action ha[s] an enforceable right." Metromedia Co. v. Hartz Mountain Assocs., 139 N.J. 532, 535 (1995) (internal quotation marks and citations omitted). See also Estate of Hainthaler v. Zurich Commercial Ins., 387 N.J. Super. 318, 327 (App. Div.) ("Generally, a cause of action accrues upon the occurrence of a wrongful act resulting in injury for which the law provides a remedy." (citation omitted)), certif. denied, 188 N.J. 577 (2006).
Procedurally, we are uncertain whether the parties' settlement agreement was actually entered as a final order of the court. The document incorporated the civil rights action caption, but no subsequent order has been provided in the record. For purposes of appeal, because the parties agree the terms of settlement were placed on the record before the Law Division, our review assumes the court entered judgment terminating the action based on the terms of settlement. See Brundage, supra, 195 N.J. at 601 ("'An agreement to settle a lawsuit is a contract, which like all contracts, may be freely entered into and which a court, . . . should honor and enforce as it does other contracts.'" (quoting Pascarella v. Bruck, 190 N.J. Super. 118, 124-25 (App. Div.), certif. denied, 94 N.J. 600 (1983)).
Plaintiff agrees the six-year limitations period set forth in N.J.S.A. 2A:14-1 applies, but argues he had no right to pursue enforcement until an accurate determination of the funding amount was calculated in September 2006. Plaintiff additionally argues defendant failed to complete the documentation necessary for his receipt of the funds until January 2007, resulting in additional damages.
Plaintiff focuses on defendant's insistence he execute a voucher to allow payment to PFRS, contending execution of a voucher "was not part of the deal." The record reflects plaintiff understood defendant's position, insisting the voucher was a pre-condition to the release of funds to PFRS within months of execution of the settlement agreement. Defendant's correspondence emphasized this condition would not be waived. The evidence unequivocally refutes plaintiff's contention the issue was being negotiated, thus causing him to be lulled into inaction. If the alleged breach is the insistence on execution of a voucher, that event occurred in 2003, triggering commencement of the limitations period.
Subsequent negotiations between the parties in an effort to resolve the differences does not toll or extend the period of limitations. Cf. Mortara v. Cigna Prop. & Cas. Ins. Co., 356 N.J. Super. 1, 3-4 (App. Div. 2001) (stating a claim must be commenced within the statute of limitations and is "not commenced by writing letters or negotiating with one's adversary"), aff'd, 174 N.J. 566 (2002). Accordingly, plaintiff's assertion the settlement agreement was breached because of the requirement of a voucher is untimely. This conclusion obviates the need to examine whether defendant's imposition of the procedural voucher mechanism was a breach of the settlement agreement.
Plaintiff also cites defendant's error in calculating his contribution amount to obtain the enhanced pension as a breach of the settlement agreement. However, plaintiff does not explain which provision of the settlement agreement was breached and our review of its terms reveals no such mandate imposed on defendant.
Plaintiff next claims defendant breached the settlement agreement when it delayed transmission of his pension application to PFRS for three months after receipt in October 2006. We note, the settlement agreement provided its terms were to be "implemented immediately[,]" yet the meaning of that term is not self-evident or defined in the agreement. On the limited record presented it appears a claim arising because funding was not remitted immediately following plaintiff's filing of his pension request would not have been barred. In his analysis, however, the trial judge failed to separately address this claim. Consequently, remand is required for further consideration of this issue.
The judge also failed to determine whether defendant's failure to pay $625 as required by paragraph 2A of the settlement agreement remained viable when defendant, acknowledging the outstanding debt, reaffirmed its obligation to remit payment in county counsel's September 2006 correspondence. The parties are at odds regarding whether the debt was satisfied. We are not in a position to resolve this dispute, which also must be finalized on remand.
Any further arguments raised in plaintiff's merits brief, but not specifically addressed in our opinion, were found to lack sufficient merit to warrant discussion. R. 2:11-3(e)(1)(E).
Affirmed in part and remanded in part for further proceedings as noted. We do not retain jurisdiction.
I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION