EVANGELOS DIMITRAKOPOULOS VS. BORRUS, GOLDIN, FOLEY, VIGNUOLO, HYMAN AND STAHL, PC(L-5373-15, MIDDLESEX COUNTY AND STATEWIDE)
A-0880-16T3
| N.J. Super. Ct. App. Div. | Oct 19, 2017Background
- Plaintiffs Matilde and Evangelos Dimitrakopoulos retained the law firm Borrus, Goldin, Foley, Vignuolo, Hyman & Stahl, P.C. (BGF) to litigate a business dispute for Matilde (majority owner of ICU); Evangelos acted as her agent.
- BGF withdrew after the court ordered arbitration of the business dispute; the arbitration settled on September 2, 2011. Plaintiffs alleged malpractice arising from BGF's representation during that underlying ICU dispute.
- While the ICU dispute was pending, BGF filed a Law Division collection action (March 2011) to recover unpaid fees; the court ultimately entered default judgment for BGF in July 2012 after plaintiffs failed to comply with discovery.
- Plaintiffs did not assert malpractice claims in the collection action; they filed a separate legal-malpractice complaint against BGF and two lawyers on September 10, 2015—about three years after the collection judgment and ten months after the underlying arbitration settlement.
- The trial judge dismissed the malpractice complaint with prejudice under Rule 4:6-2(e), holding the claim was barred by the entire controversy doctrine because plaintiffs had a fair and reasonable opportunity to raise malpractice as a defense or counterclaim in the ongoing collection action after the arbitration settled.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the entire controversy doctrine bars plaintiffs' legal-malpractice claim | Entire controversy doctrine does not apply to legal malpractice here; malpractice need not be asserted in the collection action | Malpractice claim is transactionally related to the ICU dispute and should have been raised earlier in the collection action | Held: Doctrine applies—plaintiffs had a reasonable opportunity to raise malpractice in the collection action after the underlying arbitration settled, and waited unreasonably long |
| Whether plaintiffs had a reasonable opportunity to litigate malpractice in the prior collection action | Plaintiffs contend they lacked knowledge/evidence of malpractice until later and claim the doctrine requires assertion only in the underlying suit | Defendants contend plaintiffs knew or should have known their damages by settlement and had ten months during which collection case remained pending to assert malpractice | Held: A reasonable person would have been alerted to possible negligence at settlement; plaintiffs had a fair opportunity in the collection action and failed to act |
| Whether legal-malpractice claims must be asserted in the underlying action that gave rise to the claim | Plaintiffs assert malpractice is exempt from being forced into the prior actions generally | Defendants argue the exemption does not excuse asserting malpractice when a later related proceeding (collection action) provided a fair forum | Held: Olds v. Donnelly exempts malpractice from having to be asserted in the underlying action, but does not bar application of the entire controversy doctrine where plaintiffs had a fair forum in the subsequent related proceeding |
| Whether dismissal under Rule 4:6-2(e) was appropriate and whether appellate review is de novo | Plaintiffs challenge procedural and factual bases for dismissal and contend premature dismissal was error | Defendants request dismissal on entire controversy and waiver grounds; trial court relied on the record showing opportunity to assert claims earlier | Held: Review is de novo; dismissal was legally proper because discovery would not cure the pleading and the entire controversy doctrine precluded the complaint |
Key Cases Cited
- Wadeer v. N.J. Mfrs. Ins. Co., 220 N.J. 591 (explains purpose and scope of the entire controversy doctrine)
- DiTrolio v. Antiles, 142 N.J. 253 (transactional test for related claims under the entire controversy doctrine)
- Olds v. Donnelly, 150 N.J. 424 (legal-malpractice claims need not be asserted in the underlying action that gives rise to them)
- K-Land Corp. No. 28 v. Landis Sewerage Auth., 173 N.J. 59 (entire controversy doctrine does not bar claims that were unknown, unaccrued, or would be unfair to preclude)
- Gelber v. Zito P’ship, 147 N.J. 561 (focus on whether claimant had a fair and reasonable opportunity to litigate claim in the original action)
- Caravaggio v. D’Agostini, 166 N.J. 237 (accrual inquiry: whether facts would alert a reasonable person that injury was due to another’s fault)
- Grunwald v. Bronkesh, 131 N.J. 483 (knowledge of legal effect not required for accrual)
- Printing Mart–Morristown v. Sharp Elecs. Corp., 116 N.J. 739 (standard for Rule 4:6-2(e) dismissal review)
Affirmed: the Appellate Division concluded the entire controversy doctrine barred plaintiffs’ late-filed malpractice action because they had a fair and reasonable opportunity to raise it in the related collection proceeding.