Survival of One Claim in Lawsuit Does Not Negate Award of Attorney Fees under Frivolous Lawsuit Statute

Plaintiff James Epstein sued the defendant Sondra Lippi for injuries arising out of collision between him, as he was riding his bicycle, and the automobile she was operating. In Epstein v. Lippi, 2014 N.J. Super. LEXIS 1703 (July 14, 2014 App. Div.), Epstein, who was pro se, appealed an order awarding Lippi $1000 in counsel fees and costs as a sanction for pursuing frivolous litigation. In this case, the Appellate Division was faced with deciding whether sanctions could be imposed where a party has pursued some claims which are frivolous.

Epstein was subject to the verbal threshold and, thus, to recover for his non-economic injuries, he had to sustain a permanent injury as defined by the Automobile Insurance Cost Recovery Act. In his answers to interrogatories, the plaintiff certified that his claims were not permanent. Thereafter, defendant’s counsel sent the plaintiff a frivolous lawsuit letter, demanding that he dismiss his complaint because he admitted that he did not have a permanent injury, his insurer compensated him for the loss of his bicycle, and he was not seeking recovery for lost wages or other economic claims.

The plaintiff refused to dismiss his complaint, stating that he sought to recover his out of pocket expenses incurred in seeking medical treatment and he sought full restitution for his bicycle, claiming that his insurance company only partially reimbursed him. Further, he sought punitive damages because the defendant’s conduct “displayed a conscious and deliberate disregard for the safety of others.”

The defendant moved for summary judgment on the basis that the plaintiff did not meet the verbal threshold. The trial court judge granted the motion and also dismissed the property damage claim as to his bicycle on the basis that it too was barred by the plaintiff’s failure to meet the verbal threshold.

Subsequently, the defendant moved for sanctions. The trial court awarded the defendant $1000 in counsel fees as a result of plaintiff’s continued pursuit of his claims. Defendant had sought over $5000 but the court determined that a reasonable fee to act as a deterrence in the future was $1000.

On appeal, the plaintiff contended that the trial court wrongfully dismissed his property damage claim. Further, he argued that the court should not have granted an award of fees because his property damage claim was not frivolous.

The Appellate Division reluctantly reinstated the plaintiff’s property damage claim. The court agreed with the plaintiff that this economic claim was not barred due to the plaintiff’s failure to meet the verbal threshold.

However, the Appellate Division found that the survival of one claim “does not negate the imposition of sanctions where a party has otherwise pursued other claims which are frivolous.”  The appeals court agreed with the trial court that the plaintiff presented absolutely no evidence to support a punitive damages claim and, thus, he should have dismissed that claim. As a result, the Appellate Division upheld the $1000 attorneys fee sanction assessed against the plaintiff.

Tags: verbal threshold