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NJ Appellate Division Says No to Frivolous Litigation Award

July 29, 2009

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A defendant who prevailed on a claim for fees and costs to defend litigation on the grounds it was frivolous had its award overturned by the Appellate Division in <i>Ferolito v. Park Hill Association, Inc</i>., -- N.J.Super. -- , 2009 WL 2208333 (App.Div. 2009).
The claim had been pressed under the frivolous litigation statute, N.J.S.A. 2A:15-59.1. Under this statute, a defendant may be reimbursed when a plaintiff files suit “in bad faith, solely for the purpose of harassment, dely or malicious injury” or if the plaintiff pursues a claim that he knows or should know is without any reasonable basis in law or equity to support it or without a good faith argument that the existing law should be changed. However, if the plaintiff is represented by counsel, the defendant must also prove that the plainitff pursued the claim in bad faith.
Additionally, in order to succeed on such a claim, a defendant must comply with R. 1:4-8 by serving a demand that very specifically addresses the reasons why the claim is frivolous to provide the plaintiff opportunity to withdraw the pleading.
Although the trial court found that litigation to compel a condominium association to install a satellite dish so that a resident could watch Russian language programming was frivolous, the appellate division disagreed. Finding that the litigation was motivated by a goal of great importance to the plaintiff, the court did not find bad faith. Moreover, the letter that demanded the dismissal of the claim addressed different issues than those for which the court actually dimissed the action. Thus, defendant failed to meet the notice requirement.

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