Opinion
DOCKET NO. A-5075-12T1
08-28-2014
IN THE MATTER OF THE THOMAS R. TOMEI TRUST
Davis, Bucco & Ardizzi, attorneys for appellant Vincent H. Tomei (Paul A. Bucco and Matthew I. Sack, on the brief). Kulzer & DiPadova, P.A., attorneys for respondent Thomas R. Tomei (Eric A. Feldhake, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Sapp-Peterson and Sabatino. On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Camden County, Docket No. CP-0120-2013. Davis, Bucco & Ardizzi, attorneys for appellant Vincent H. Tomei (Paul A. Bucco and Matthew I. Sack, on the brief). Kulzer & DiPadova, P.A., attorneys for respondent Thomas R. Tomei (Eric A. Feldhake, on the brief). PER CURIAM
Defendant, Vincent H. Tomei, appeals from the trial court order declaring that the termination date of a trust established by his son, plaintiff, Thomas R. Tomei, was August 18, 2003 rather than August 18, 2013 as defendant alleged. We reverse and remand for a plenary hearing.
Plaintiff is the President and CEO of H&H Manufacturing, Inc. ("H&H"), a Pennsylvania company. In 1983, he created the Thomas R. Tomei Trust ("the trust"). Plaintiff is the trust's settlor and defendant is the trustee. Plaintiff created the trust to provide benefits to himself. On June 12, 2013, plaintiff filed a verified complaint in the Chancery Division, Probate Part, seeking to confirm termination of the trust, compel an accounting, impose resulting and constructive trusts, and for injunctive relief. Attached, as Exhibit A, to the verified complaint was a copy of the "Deed of Trust," which language stated that the trust would exist for a full term of twenty years from its inception until August 18, 2003.
The court conducted a hearing on June 17, 2013, at which only plaintiff's counsel appeared. Plaintiff's counsel argued that
the [t]rust was to terminate in August of 2003. Didn't happen. It's between a family member. There hadn't been issues up until the last two months, when the father's behavior caused grave concern by my client, and required him to look into the [t]rust and to effectuate the terms of the [t]rust, including distribution of the [t]rust assets, in order to prevent possible continuation of the bad acts by the father as Trustee[.]When the court expressed its understanding that the trust ended "some 10 years ago," plaintiff's counsel responded, "Yes, Your Honor."
The court expressed hesitation in signing the proposed order seeking restraints upon defendant's access to the trust because of the issue of service upon defendant. Plaintiff's counsel advised the court that service was effectuated by certified mail and first class mail. The court advised counsel that it would like plaintiff's counsel "to attempt personal service also. I'd like to have somebody go knock on the door[.]" At that point in the proceeding, court personnel advised the court that defendant's attorney was on the phone, and he was patched into the courtroom.
Defense counsel first questioned the court's jurisdiction because H&H is a Pennsylvania corporation. Next, counsel advised the court that defendant was never served. Instead, he received only an email on the preceding Friday and started to look at it the morning of the hearing and realized "that there was a hearing date at 9:30." Defense counsel then represented to the court that the trust "does not terminate as of August 18, 2003. It terminates as of August 18, 2013."
Defendant has supported his position with a copy of what he purports to be the genuine trust, which contains a termination date of "August 18, 2013."
Despite the dispute as to the termination date of the trust, defense counsel expressed that he did not believe defendant would resist turning over the trust assets on the "18th of August." In response, the court indicated that although it was prepared to sign the proposed order submitted by plaintiff's counsel, it was "more than happy to hold off, and let the two [a]ttorneys perhaps confer and see where we are." Both counsel agreed to this process.
Notwithstanding this agreement between counsel, both counsel continued to place on the record disagreements related to ownership of H&H, leading the court to state that it had no intention of resolving that dispute, but was prepared to address release of the monies in the trust:
So how do we get the monies released again? I am not getting in the middle of a battle between this father and the son over who owns the company and who's running the company based on this [o]rder. If this lawsuit continues and you think it belongs here, fine. If it belongs to Pennsylvania, fine. But today, those monies are going to be released. The company's going to be up and running, and this father and son could do whatever battle they want on an even playing ground.
Insofar as the order the court was initially prepared to sign, the court invited the attorneys to attempt to work out the form of order. Defense counsel offered to "take a shot at it." He suggested to the court that all the order would say was that "the [o]rder of June 17th that you filed is hereby rescinded; something like that, I guess." Plaintiff's counsel added, "[a]s it relates to the Citizens Bank[.]" In response, the judge stated that if that's all the order would say, she would "sign it" and "it will be done."
Later on June 17, defense counsel submitted a proposed order and a copy of the trust. The next day, plaintiff's counsel submitted a proposed form of order, which order stated that the trust terminated as of August 18, 2003. The court signed plaintiff's proposed form of order. The present appeal followed.
On appeal, defendant contends the trial court erred by signing an order that included its determination the trust terminated on August 18, 2003 because the termination date of the trust is a genuinely disputed issue of fact, which could not be resolved based upon the parties' submissions. In addition, defendant argues the court failed to comply with Rule 4:42-1(c), which affords a party opposing a proposed form of order five days in which to submit specific objections to the court.
In response, plaintiff urges the court did not err because the order submitted by plaintiff's counsel reflects the court's oral decision, and therefore did not produce an unjust result. Moreover, because the termination date of August 18, 2003 allegedly does not materially harm defendant or prejudicially affect defendant's rights, plaintiff contends there was no harmful error. We disagree.
At the outset, the court did not reach a determination in the hearing as to the termination date of the trust. The court made clear that its primary concern was the release of the monies, to which defense counsel did not pose an objection, beyond the timeframe when the monies would be released, for which an agreement was reached. Defense counsel participated in the hearing telephonically and made clear his client's position that the trust terminated on August 18, 2013. Thus, the termination date of the Trust should not have been included in the order.
Plaintiff has alleged that defendant misappropriated funds being held in the trust, implicating a cause of action for breach of fiduciary duty. The termination date of the trust may be relevant to whether the actions of defendant, about which plaintiff complains, fell within or beyond the scope of defendant's obligations and rights under the trust. The dispute was not merely a bald assertion, but is supported by the contrary documentation submitted by defendant reflecting a later termination date. The fact that the trust had not been terminated as of August 18, 2003, but remained in place for the next ten years, raised an inference favorable to defendant that the trust did not terminate until August 18, 2013. Therefore, the court erred in signing an order that included the termination date when that issue was genuinely disputed. Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).
More importantly, the court failed to give defense counsel a sufficient opportunity to object to the proposed form of order. Rule 4:42-1(c) provides:
Settlement on Notice. In lieu of settlement by motion or consent, the party proposing the form of judgment or order may forward the original thereof to the judge who heard the matter and shall serve a copy thereof on every other party not in default together with a notice advising that unless the judge and the proponent of the judgment or order are notified in writing of specific objections thereto within 5 days after such service, the judgment or order may be signed in the judge's discretion. If no such objection is timely made, the judge may forthwith sign the judgment or order. If objection is made, the matter may be listed for hearing in the discretion of the court."It is, of course, clear that an order should never be either submitted or signed under this rule unless it accurately memorializes court dispositions, is submitted following default, or has all parties' consent endorsed thereon." Pressler & Verniero, Current N.J. Court Rules, comment 3 on R. 4:42-1 (2014) (citing City of Jersey City v. Roosevelt Stadium Marina, Inc., 210 N.J. Super. 315 (App. Div. 1986), certif. denied, 110 N.J. 152 (1988)).
Here, defendant submitted a proposed form of order on June 17, 2013. The next day, plaintiff submitted a proposed form of order on June 18, 2013, with a material difference. Defendant's proposed form of order included a trust termination date of August 18, 2013. Plaintiff's proposed form of order indicated a trust termination date of August 18, 2003. The trial court signed the order submitted June 18, 2013, that same date, notwithstanding this issue was clearly disputed between the parties. Because the court did not declare the termination date was August 18, 2003, it should not have signed the order without first affording defense counsel an opportunity to object to the form of the proposed order and a hearing to resolve the disputed termination date.
Reversed and remanded for further proceedings, which shall include a plenary hearing to resolve the disputed trust termination date. 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 APPELLATE DIVIDION